Startups Provide The Spark: Emerging Vendors You Need To Know In 2022
In our annual Emerging Vendors special report, CRN shines a spotlight on some of the most exciting channel-focused startup vendors with leading-edge technologies that are creating new opportunities for solution providers.
Despite the pandemic and the economic uncertainty of the last several years, the IT industry has continued to innovate. And much of that innovation is driven by startup companies.
By far the lion’s share of IT products sold by the channel come from the industry’s established vendors such as Dell Technologies, Hewlett Packard Enterprise, Cisco Systems and Microsoft. And those companies certainly have their own innovation track records.
But many of the industry’s most innovative technologies and products come from startups with no legacy products – or legacy thinking – to hold them back. These companies may not be household names, but they are gaining attention and market traction as they push the IT envelope.
[Related: Emerging IT Vendors You Need To Know In 2022: The Complete List]
Solution providers looking for a competitive edge should take note of startups with breakthrough technologies they can use to develop innovative solutions and services for their customers.
Here we present the CRN 2022 Emerging Vendors, 136 startups founded in 2016 or more recently with annual sales of less than $1 billion that are working with channel partners in North America.
Some of the companies on this year’s list have already established a presence in the industry. Orca Security and Wiz, for example, have high profiles in the cloud security space. Likewise for HYCU and Hammerspace in data storage. ComputerVault is making a name for itself in the virtual desktops/servers and hyperconverged infrastructure arena. And startups Alkira, Celona and Infiot are making waves in the networking/unified communications market.
Startups often initially focus on selling directly to a limited number of early-adopter customers, only turning to the channel as they look to expand their sales reach. But savvy startups recognize that solution providers can introduce their next-generation technologies to potential customers sooner by building solutions around them and providing services that make it easier to adopt leading-edge products.
Celona launched its Fanatics channel program in June with the goal of helping its reseller, MSP and system integrator partners sell the startup’s 5G wireless connectivity. “This technology represents where everything is going as it relates to digital transformation,” Ron Gill, Americas channel chief, told CRN. “And when you’re bringing a new slice of wireless spectrum to customers to solve use cases and deliver outcomes that they’ve struggled to deliver, it’s a great place for partners to invest in.”
One indication of the value of IT startups is the amount of venture funding they attract. Starburst, a Boston-based developer of advanced data analytics technology, has raised $414 million in funding – including $100 million in January 2021 and $250 million in January of this year – putting its valuation at $3.35 billion. In February cloud data warehouse provider Firebolt raised $100 million in a funding round that boosted its valuation to $1.4 billion.
Cybersecurity startups have particularly attracted the attention of venture capital investors. In February Salt Security, a developer of API security technology, raised $140 million in funding that boosted its valuation to $1.4 billion. Secure browser developer Island raised $115 million in a funding round in March that established its valuation at $1.3 billion. And in April zero trust endpoint security provider ThreatLocker raised $100, bringing its valuation close to $1 billion.
Another indication of the value of IT startups is how often they are acquired by big IT vendors looking to expand their portfolios with leading-edge products.
On June 16, after this year’s Emerging Vendors list was assembled, online community giant Reddit acquired Spell.ml, a hot startup with a deep learning applications platform. On July 6 IBM, looking to expand its offerings in the fast-growing data observability space, acquired Databand, an Israel-based data observability platform developer.
Sometimes startups buy startups. In June Starburst bought Varada, an Israeli developer of data lakehouse analytics acceleration software launched in 2017, for an undisclosed sum.
With the uncertain economy and plunging stock markets, startups’ potential valuations are lower and it’s becoming harder for them to raise financing. That means more early-stage startups could be acquisition targets, said Justin Borgman, CEO and co-founder of Starburst, which is on the hunt for other potential acquisitions.
“It gives us the opportunity to look for startups that will have a harder time continuing to raise funding at the valuations that they could have raised a year ago and that creates [acquisition] opportunities,” Borgman said.
Details of the startups making this year’s roundup of Emerging Vendors can be found in the following slide shows being posted through this week:
*Application Development and DevOps