December 12, 2011

Boston Globe

When digital files grow like weeds

Whether you purchase a toaster oven, execute a stock trade, or hire someone, you probably have never thought about how many digital records are created. 

Ash Ashutosh has. The founder of Waltham-based Actifio says organizations sometimes keep as many as 120 copies of the same file.

“In starting the company, we talked to 40-plus customers,’’ Ashutosh said, “and everywhere we saw evidence of this data explosion and the need to shrink the storage footprint.’’

In other words, the amount of data most companies accumulate is increasing fast. But why should they be spending money to store so many copies of the same stuff?

Actifio recently raised $33.5 million in its third round of funding, led by Andreessen Horowitz of California. The company had previously raised $24 million from North Bridge Venture Partners, Advanced Technology Ventures, and Greylock Partners. The new money will go toward global expansion and a marketing push.

Actifio’s pitch is that its software can supplant the various backup, compliance, and snapshot software companies use to archive copies of important files and make those files easily accessible. Rather than stashing 15 or more copies of the same file, Ashutosh said, Actifio’s magic number is 1.6, on average. “You can keep more copies, if you want,’’ he said, “but that’s the number of copies you need to make the file available everywhere.’’

“Every enterprise and every website has storage behind it and lots of data being created,’’ said Peter Levine, the Andreessen Horowitz general partner who is joining Actifio’s board. “The cost of storage itself has been going down, but the expense and the management overhead of keeping track of all those copies is huge.’’

The company has about 50 employees in Waltham and 50 elsewhere.

MassChallenge may branch out

The founders of the MassChallenge competition, which offers $1 million in prize money to promising start-up companies, have spent the summer and fall engaging in conversations about expansion. While bringing the competition to a second city will require funding commitments from philanthropists and corporate sponsors - they have not yet been nailed down - it sounds like New York tops the list, followed by London. The Boston-based program enters its third year in 2012; founder John Harthorne says a second city won’t be added before late next year or 2013.

On New York, Harthorne said: “There’s a lot of money, and a big media presence. We’ve been talking to billionaire types and major corporate entities.’’

While there’s no anchor funder yet for a Manhattan-based MassChallenge, there are interested parties, Harthorne said.

Cofounder Akhil Nigam traveled to London in November to discuss the potential of a second MassChallenge program operating there. When I caught up with Harthorne by phone, he was on his way to Brazil, to participate in the state’s Innovation Economy Mission. “Brazil would be an interesting place for us,’’ he said.

Though the Boston program received applications from 733 start-up teams this year (up from 446 in its inaugural year), there are two questions: whether a second site for MassChallenge would dilute the quality of entrants, and whether state agencies that have offered financial support would feel it was doing enough to boost economic development in Massachusetts if it was doing the same thing in New York.

Harthorne said a New York program “could be complementary to both locations. Boston and New York both have a common enemy, which is California, and all of the hype that surrounds Silicon Valley.’’