UK-Based Partner Looks To Bail Out Nirvanix

This week’s sudden and surprise announcement by cloud provider that customers have less than two weeks to get their data out the door before the company shuts down forever showed the harsh realities of competition.

But a bid by a major Nirvanix partner, and supported by , may yet show that the flexibility of the cloud will save the day. London-based Aorta Cloud, and its sister company, Aorta Capital, are staging a dramatic effort shore up the troubled cloud vendor and make sure customers’ data remains available after Nirvanix’s end-of-the-month deadline.

“Our current plan is to raise the funds to allow operations to continue in sustain mode (i.e. no new business) for a minimum of two months to allow a stabilzation period and for proper financing to be put in place,” writes Steve Ampleford, CEO of Aorta Cloud and Aorta Capital, on a company Web page discussing the effort. “If nothing else this will allow a more gentle managed exit for customers, but the intention is obviously to take the good work, great people and great technology forward as a going concern.”

But the company seems to have bigger plans than that. By midweek, the company had confirmed it has “a seven figure commitment” to pump cash into kickstarting the effort, and has a bank partner willing to match that investment. The company believes it will be able to reduce costs by consolidating from seven data centers worldwide down to two or three, a move that will buy it time to keep things running and figure out where to go next.

So what went wrong? While Nirvanix started out competing on value, it got dragged into price wars with massive competitors in the form of , , and – competitors with data centers for their own purposes, and with much greater scale and much deeper pockets that Nirvanix. While it grew rapidly, it grew unsustainably, and like a plane that trades speed for altitude, eventually it reached the point where they wasn’t enough lift to avoid a stall.

But Ampleford told Channelnomics he believes there’s an opportunity to take Nirvanix back to its roots competing on value. The growth rates may not be as heady as Nirvanix was used to, but he believes that by offering premium service, the business can be sustainable.

“People are keen to keep their data, if they can, in a very similar environment. They’ve bought into the technology, the setup, and the people of Nirvanix. That hasn’t changed. What’s changed is the financial position,” Ampleford said.

With an open letter on its Web site, Aorta is reaching out to existing Nirvanix customers to see if they “would like a part to play in their future, by taking a stake in whatever package and structure results.”

Aorta’s actions have come together with the kind of speed and agility that marketers love to pin on cloud computing. Ampleford said his company was made aware of Nirvanix’s imminent closure at the end of the business day on Monday. By 10:00 pm local time that day, it had hatched its plan and posted its open letter to the community. By Thursday, the company confirmed that IBM is “an active participant in our attempt to drive forward a solution,” and Ampleford suggested that while things might go quiet for as much as 24 hours now, things are still moving very rapidly on many fronts behind the scenes.

“The pace with which this has come together is a barometer of the desire to find a solution,” Ampleford said.

While Aorta is a major Nirvanix partner, it is far from the company’s only channel partner. Nirvanix has historically worked with a worldwide network for VARs, MSPs, and other service providers – some as resellers, and some as customers. Ampleford said his team has stated to envision the role his fellow Nirvanix partners would play should his bid to save Nirvanix be successful, but that’s its too early in the process, and there are still too many pieces as yet undecided, to firmly discuss the role for Nirvanix partners in an Aorta-headed turnaround plan.

“There are a whole host of people involved in this, and we need to see if we can find a route forward,” he said. “It’s not going to be totally satisfactory to everybody, but if we can work out something that’s at least tolerable to everybody, we’ve got to give it a go.”

The company is still gathering customer feedback through the open letter on its Web site, and would also welcome contact with fellow Nirvanix partners interested in its effort to keep Nirvanix customers in the cloud.

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