Security Platforms/Tools

Inkra Goes Virtual

Inkra Networks Inc. has shut down, Light Reading sources say.

The company closed its doors at the end of May, according to those close to the situation. The more than 100 employees were cut and the technology assets were sold to two different bidders.

Cisco Systems Inc. (Nasdaq: CSCO) and Nortel Networks Ltd. (NYSE/Toronto: NT) bought bits and pieces of the company's intellectual property, these sources say. Cisco got the company's management system and Nortel picked up Inkra's hardware and some software as well.

Inkra's promise of delivering virtualization was one that was very relevant to data center managers -- and the company was prolific on the topic (see Virtualization Eliminates Uncertainty, Keeping IT Simple, Utility Computing: Where Is It At?, and Let's Get Virtual). Its Virtual Service Switch, simply put, allowed data center managers to deploy multiple instances of a variety of security and management services -- all from the same appliance.

Using Inkra's Virtual Service Switch platform, its carrier customers could, for instance, economically offer a managed firewall service to customers without having to buy a separate standalone device for each customer managed.

The company had some customers, too. Telindus Group NV (Euronext: Tel.BR), Savvis Communications Corp. (Nasdaq: SVVS), and IBM Corp. (NYSE: IBM) all used its gear -- and all those customers are more or less stranded, sources say.

Inkra raised $67 million since its inception, but word on the street was that it desperately needed another funding round -- and its backers backed away.

Calls to Sanjay Dhawan, the company's founder and its CEO, until July 2004, were not returned.

— Phil Harvey, News Editor, Light Reading

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DCITDave 12/5/2012 | 3:04:40 AM
re: Inkra Goes Virtual Any guesses as to why the VCs didn't step up for Inkra?

lightreceding 12/5/2012 | 3:04:38 AM
re: Inkra Goes Virtual "Any guesses as to why the VCs didn't step up for Inkra?"

Only guessing here but I think it is because their buzzword coeficient is low.

Inkra does virtual switches that enable a managed security service. Those buzzwords are about 5 years old.

Alloptic just got $30 million. They do optical to the home that delivers IPTV, which is the current hot buzz word.
DCITDave 12/5/2012 | 3:04:37 AM
re: Inkra Goes Virtual Good point. They were a quiet company anyway. Some companies are just like that.

Also, they had customers, revenues, 100 employees -- not the kind of company we usually keep on the Death Watch list.

mellonHead 12/5/2012 | 3:04:37 AM
re: Inkra Goes Virtual how is it they go under in May and your
just gettin' the scoup now?

Sisyphus 12/5/2012 | 3:04:37 AM
re: Inkra Goes Virtual
This was a while ago, and I remember being very surprised when I heard about it. They had significant revenue, and they were in a good market spot.

One never knows what to believe, but someone told me that it was one out of all the investors to got cold feet last minute, and that the rest were not very thrilled about the outcome. And several of the investors were of the "it's our policy to not put more than $xM into a company over its entire lifetime", and probably were getting close to that limit given the amount of money the company had raised.
sgamble 12/5/2012 | 3:04:36 AM
re: Inkra Goes Virtual Heh. Well there goes that idea. This was one of the companies I was looking at for launching managed services in a central model. Booo.
probably 12/5/2012 | 3:04:36 AM
re: Inkra Goes Virtual Perhaps Inkra got taken out by Mothra.
optical_man 12/5/2012 | 3:04:36 AM
re: Inkra Goes Virtual Amazing that Nortel did not give them $8B.

They gave Alteon that amount.

What gives Norty? Afraid to step up to the plate for a company with 1 product and $10M/yearin revenue, or just out of money?

Alteon. $10M/year in Revenue. One Product, Web Cache box. Purchase price: $8B.
Do the math. Even with the 'power' of Nortel sales force, $10M to $8B is a 60 year investment.
That was May 2000. The beginning of the end.

Yikes, it's happening again.

(he-he, just a little bubble humour, not really, oh yes really, no, seriously, 'they paid that much?, Yes they did, "oh shit, I have stock in this Canadian company and they are buying more stuff that they can't sell?" Yes they are, "oh no", better ask the Government for a bail out like the Americans did for Chrysler)

I love having conversations with myself. I never listen to me, but get myself ALL WORKED UP over nothing.

Reminds me of the M&A team at Nortel.

What a fun time that was, spending everyone else's money to satisfy my bosses ego, while he stroked Roth's delusions of granduer.
deauxfaux 12/5/2012 | 3:04:35 AM
re: Inkra Goes Virtual Heard throught the grapevine that the VCs weren't happy with the way that Sales stalled and a bunch of relationships (most notably NEC) fell apart after the CEO "scapegoated" the VP of Sales

The VCs let him get away with it, and didn't realize the mistake until it was too late
Upside_again 12/5/2012 | 3:04:26 AM
re: Inkra Goes Virtual You say the (nec) relationship and deals fell apart after CEO scape-goated VP of sales.

If I understand, the sales VP was lagging, the CEO then scaped-goated him, and the customer relatiohsips then turned unhappy? Then the VC killed the company?

Not sure that makes any sense....please explain further.
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