Netsil Acquired by Nutanix

We’re excited to announce that Nutanix (NASDAQ: NTNX) has acquired Moment Ventures portfolio company Netsil. Congratulations to Founder/CEO Harjot Gill and the entire team at Netsil for such a successful outing! Netsil’s story is such a great lesson in both determination and capital efficiency. We’re humbled in that this is the 7th M&A event for our debut fund Moment I, and the outcome is our best yet. The formal details of the announcement can be found in the official press release and video.

I was originally introduced to Netsil (then called Gencore) in early 2015 by my friend Josh Kopelman at First Round Capital, who I had the pleasure of working with on an investment in API pioneer Mashery. Harjot and his professor Boon Thau Loo at the University of Pennsylvania were in the process of spinning out an innovation that they developed during their time at Penn to provide deep and real-time insight into the interactions between the various microservices components making up an application. Equipped with a grant from the National Science Foundation (NSF), Harjot and his founding team set sail to create Netsil. Moment Ventures became the first institutional investor to back Netsil as soon as Harjot relocated his team to San Francisco in mid 2015. Shortly thereafter, the company raised a seed round and added Google and Twitter engineering veteran Shariq Rizvi to the senior management team.

San Francisco based Netsil

While You Build It, Ask If They Will Come

In its early days, Netsil had built a powerful platform, but had yet to determine how best to position themselves for the market. The founders spent the first couple of years diligently building up their engineering team and designing a platform robust enough to address the needs of the evolving microservices customer base. Harjot and Shariq spent lots of time speaking to companies and seeking their input as to how to best leverage the Netsil platform. Among numerous use cases, one particular that kept coming in from customers was Kubernetes based container monitoring, as Kubernetes was quickly becoming the de facto microservices deployment platform for new application development. Netsil timed their company and product launch just as this was happening in the summer of 2017, and as a result, captured an industry leading position in the emerging Application Observability space just as market demand began to surge.

One huge key to Netsil’s success and a great lesson for future entrepreneurs: Netsil remained very capital efficient and as a result able to take this patient approach on only a single, formal round of financing from 2015.

Netsil is “Listen” Spelled Backwards

Netsil likes to say that to properly monitor your microservices apps, you need a way to listen to the network to understand how the disparate components are interacting with each other, which is why changing their name from Gencore to Netsil made perfect sense. Anyone who has ever had to debug a home network or AV stereo system knows that when something goes wrong, the first thing you do is check the wiring and connections. Harjot explains Netsil’s approach well in his recent blog post on U Penn’s Engineering Blog on Medium:

“Listen” spelled backwards, Netsil is based on a unique technology that provides real-time, non-intrusive monitoring of communications in cloud applications, similar to neuroimaging techniques such as positron emission tomography. “We use the data that we collect from the communication patterns we observe to build a map of cloud apps and find areas of congestion,” Gill says. “It’s a groundbreaking technology that allows us to understand the performance of cloud apps better than any other technique on the market.”

A Powerful Platform for the Future

Nutanix plans to demonstrate their vision for Netsil’s platform at their Analyst Demo Day in March 2018, and we’re excited to see how the teams work together to further extend Nutanix’s footprint and industry leading position in the hyperconverged IT infrastructure ecosystem.

Gartner’s 2018 Magic Quadrant for Hyperconverged Infrastructure

We’re proud to have been Netsil’s first institutional investor and really enjoyed working with our terrific co-investors at Mayfield and Engineering Capital. Congrats to Harjot, Shariq and the entire team at Netsil, as well as the impressive team at Nutanix — we’re grateful to be a part of this journey!

This blog entry was originally posted on Medium.

Clint Chao is a General Partner at Moment Ventures, an early-stage venture capital fund based in Palo Alto, CA. You can reach/follow him on LinkedInFacebook and Twitter.

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