Deal activity has jumped 75% YoY on the back of large acquisitions by Juniper Networks and VMWare and Cyan’s public offering.
Software-defined networking (SDN) gives network administrators the ability to configure and maintain networks using centralized software rather than having to manually execute commands on hardware. And venture capital investors are increasingly betting that SDN will have a lasting impact on IT infrastructure.
From Q3’12 through Q2’13, SDN-related startups have raised nearly $416M across 35 deals. YoY deal growth over the past two years has jumped 75% while YoY funding has ticked up nearly 45%. Just last quarter, 10 SDN-related financings took place to companies including Midokura, NetSocket and Intel Capital-backed Netronome Systems.
The funding uptick within the SDN ecosystem has been spurred by several big exits including Nicira Networks (acquired by VMWare), Contrail Systems (acquired by Juniper Networks) and Cyan (went public). In fact, six SDN-related companies saw $2.26B in aggregate disclosed exit value over the past two years, which is over 320% more than the $704M in total funding to SDN-related startups. The chart below highlights the steady funding growth in conjunction to the notable exits in the SDN space.