Personal blog of Yzmir Ramirez

VMware is hosting its VMworld customer conference in Las Vegas this week, and to get things going it announced that it’s acquiring Boston-based CloudHealth Technologies. They did not disclose the terms of the deal, but Reuters is reporting the price is $500 million.

CloudHealth provides VMware with a crucial multi-cloud management platform that works across AWS, Microsoft Azure and Google Cloud Platform, giving customers a way to manage cloud cost, usage, security and performance from a single interface.

Although AWS leads the cloud market by a large margin, it is a vast and growing market and most companies are not putting their eggs in a single vendor basket. Instead, they are looking at best of breed options for different cloud services.

This multi-cloud approach is great for customers in that they are not tied down to any single provider, but it does create a management headache as a consequence. CloudHealth gives multi-cloud users a way to manage their environment from a single tool.

CloudHealth multi-cloud management. Photo: CloudHealth Technologies

VMware’s chief operating officer for products and cloud services, Raghu Raghuram, says CloudHealth solves the multi-cloud operational dilemma. “With the addition of CloudHealth Technologies we are delivering a consistent and actionable view into cost and resource management, security and performance for applications across multiple clouds,” Raghuram said in a statement.

CloudHealth began offering support for Google Cloud Platform just last month. CTO Joe Kinsella told TechCrunch why they had decided to expand their platform to include GCP support: “I think a lot of the initiatives that have been driven since Diane Greene joined Google [at the end of 2015] and began really driving towards the enterprise are bearing fruit. And as a result, we’re starting to see a really substantial uptick in interest.”

It also gave them a complete solution for managing across the three of the biggest cloud vendors. That last piece very likely made them an even more attractive target for a company like VMware, who apparently was looking for a solution to buy that would help customers manage across a hybrid and multi-cloud environment.

The company had been planning future expansion to manage not just the public cloud, but also private clouds and data centers from one place, a strategy that should fit well with what VMware has been trying to do in recent years to help companies manage a hybrid environment, regardless of where their virtual machines live.

With CloudHealth, VMware not only gets the multi-cloud management solution, it gains its 3000 customers which include Yelp, Dow Jones, Zendesk and Pinterest.

CloudHealth was founded in 2012 and has raised over $87 million. Its most recent round was a $46 million Series D in June 2017 led by Kleiner Perkins. Other lead investors across earlier rounds have included Sapphire Ventures, Scale Venture Partners and .406 Ventures.

CloudHealth, a startup that enables customers to manage a multi-cloud environment, announced today it was adding support for Google Cloud Platform.

With today’s addition, CloudHealth now supports AWS, Azure, VMware and Google, giving customers a fairly comprehensive view of their cloud usage.

Company co-founder and CTO Joe Kinsella says the company has been seeing inbound interest for Google Cloud support dating back to 2014, but up until now there hasn’t been enough interest to warrant a startup investing the resources necessary to support another platform. He says that has changed over the last 12-18 months as they’ve seen an increase in requests and decided to take the plunge.

Google Cloud cost summary page in CloudHealth. Screenshot: CloudHealth

“I think a lot of the initiatives that have been driven since Diane Greene joined Google [at the end of 2015] and began really driving towards the enterprise are bearing fruit. And as a result, we’re starting to see a really substantial uptick in interest,” he said.

As for why Google is gaining traction, Kinsella believes they have found ways to differentiate themselves in some key areas. “Its two biggest differentiated services are in machine learning services and the App Engine service. I also think that they have generated a lot of innovation across Infrastructure as a Service and Platform as a Service, and they built really reliable, durable, flexible, highly configurable services,” he said.

Dave Bartoletti, an analyst with Forrester Research, who specializes in the public cloud says he has also seen increasing interest in Google Cloud. “Google’s developer experience (e.g., role/account management, CI/CD toolchains, and language support) now rivals AWS and Microsoft. Very strong identity and access management, security, database, and AI/ML services are drawing increasing numbers of traditional enterprise customers,” Bartoletti told TechCrunch.

CloudHealth is a cloud-based subscription service. Customers sign up and enter their cloud credentials and they get an integrated view of their cloud activity in a single interface. Kinsella says their solution provides several primary benefits including visibility, governance, compliance and cost control.

Cross cloud usage view in CloudHealth. Screenshot: CloudHealth

The company’s primary competitor is customers trying to build a tool to monitor multi-cloud activity themselves, something that Bartoletti also sees. “Cloud cost monitoring and optimization tools help clients pay only for what they use, pay as little as possible for what they use, and develop best practices for workload sizing and automated operations to continue to save money over time, without needing to build a large cost management practice in house,” he said.

The company, which has over 300 employees, is based in downtown Boston with multiple offices around the world. It was founded in 2012 and has raised over $87 million with its most recent Series D round generating $46 million from the likes of Kleiner Perkins, Scale Venture Partners, Meritech Capital Partners, Sapphire Ventures and .406 Ventures.