Virtuozzo Acquires OnApp, Targets Full IaaS, PaaS For Cloud Solution Providers

‘Employees all of a sudden realized people work from home, at least part time. It’s the same with the IT stack. Why host anything on-prem?’ says Virtuozzo CEO Alex Fine.

Cloud infrastructure provider Virtuozzo Tuesday unveiled the acquisition of OnApp, which develops cloud solutions for service providers, as a way to expand its hybrid cloud business.

Financial terms of the deal were not disclosed.

With the acquisition, London-based OnApp will become a division of Schaffhausen, Switzerland-based Virtuozzo, said Virtuozzo CEO Alex Fine.

The move will also accelerate Virtuozzo’s leading role as a provider of infrastructure-as-a-service to service providers, something the company has been doing for 21 years, Fine told CRN.

[Related: NetApp Leans Hard Into Hybrid Cloud With New Ontap, FlexPod as a Service]

OnApp in large part serves the same niche of service providers that Virtuozzo does, he said. “We have competed respectfully for years,” he said. “We even have some joint customers.”

OnApp, founded in 2010, has raised a total of $20 million in funding, according to Crunchbase.

Virtuozzo has been focused on virtualization, software-defined storage, and orchestration, and less on the management layer, while OnApp has been focused on orchestrating, management, user interfaces, and networking, Fine said.

“We’re putting together the two teams and technology stacks to meet the needs of service providers from the smallest to the largest, not including the hyperscalers, to do both IaaS and PaaS (platform-as-a-service), he said.

By doing so, Virtuozzo will be looking to stake its claim on a fast-growing market, Fine said. Cloud infrastructure is a large market, including IaaS, PaaS, and storage-as-a-service, and one-third of it is not addressed by the hyperscalers, he said

“We target the entire market outside of the hyperscalers,” he said. “This market is growing 35 percent year-to-year.”

David Klauser, director of the Americas for Virtuozzo, told CRN Virtuozzo is putting a stake in the ground with the hybrid cloud service provider community.

“The only alternatives they have had in building multi-tenant, multi-cloud solutions are the hyperscalers or using captive solutions. VMware, Nutanix, and so on are not designed for, by, or with service providers. We help them with cloud, managed, and hosted services, and provide solutions tailored to what they need.”

The move to increase its reach into the cloud infrastructure market comes at a critical time as the COVID-19 pandemic has significantly amplified the demand for services providers, Fine said.

“Employees all of a sudden realized people work from home, at least part time,” he said. “It’s the same with the IT stack. Why host anything on-prem? Why host on-prem when the entire concept of premises is changing? So we’re seeing services delivery by service providers growing. They are creating solutions with us for clients from SMBs to the enterprise.”

To better reach the more than 100,000 MSPs worldwide, and the 30,000 to 50,000 in the U.S., Virtuozzo is also strengthening its distribution relationships, particularly with Arrow and Ingram Micro, to bring licensing, professional services, and cloud-based services to partners, Fine said.

“We also just launched Virtuozzo Hybrid Cloud, our own cloud offering,” he said. “When you look at scale and time to market, most MSPs don’t want to touch the hardware. They want to provide solutions and software. So we’re offering our own enterprise-grade cloud. It’s like AWS, but for service providers and powered by service providers.”