Viewpoints

F5 Networks Announces Intent to Acquire Volterra for $500M: Insights from Our Three Year Journey


January 7, 2021 – F5 x Volterra

Today F5 Networks has announced its intent to acquire Volterra for $500M to enable application security, networking and delivery as an easy-to-use, enterprise-grade SaaS service for DevOps and NetOps teams, cloud architects and line-of-business app owners across organizations globally.

I have known Ankur Singla, co-founder and CEO of Volterra, for the better part of this decade.  We first met in 2012 while he was raising his Series A for Contrail Systems, his prior company.  While we did not invest in that company, we stayed in touch as both of us really enjoyed the intellectual interaction.  Contrail built a unique software-defined networking product, and was acquired later that year by Juniper Networks.  Our relationship deepened over the years, facilitated by Juniper founder Pradeep Sindhu, where we serve as the founding investor in his new company Fungible.  Ankur and Harshad Nakil, Volterra co-founder and CTO, identified a big problem area facing large enterprise customers and decided to leave Juniper to found another company.  We brainstormed on the journey of how to get from idea to company and led the Series A as founding investor in Volterra in November 2017.  Investing at this early stage was fueled by our belief in the founding team and our philosophy of being a people-first investor who has experience working alongside many enterprise founders to help define their trajectory, including Jake at Brighter/Cigna; Guru at CloudSimple/Google; Kumar and his team at CloudGenix/Palo Alto Networks; Murli and his team at Portworx/Pure Storage; and Sheng and his team at Rancher/SUSE.

Over the last three years, Ankur and his team have built Volterra into a category-defining company.  Just in the last year since it launched from stealth mode, Volterra has grown its revenue 300% year-on-year and built a set of top-tier, well known customers around the world, including a Fortune 25 global enterprise, 3 of the world’s top 10 telecom service providers, and several multi-billion dollar enterprises across the US, Asia and Europe.  Having enjoyed a front row seat on the Volterra journey, here are some lessons that might serve to guide other entrepreneurs.

Be bold & think big

Over the years, Ankur and his team saw many large enterprise customers struggling with the networking, security and operations of complex infrastructure as they evolved and innovated their apps — especially as they migrated to the cloud or implemented modern container- and microservices-based workloads. Seeing that this trend was going to accelerate, Volterra was founded with the vision to allow customers to focus on what they know best — business logic and building great apps — by providing them a comprehensive and SaaS-based stack to manage the networking, security and operations of apps running in any location — one or more clouds, hybrid or at the edge. This required building a full-stack solution, a monumental undertaking for a start-up, but one Ankur believed was the only way to go. 

The result was an industry first — a 100% SaaS-based fully-integrated distributed cloud services platform that could be deployed anywhere to manage the networking, security and operations of apps:

Chart of Volterra's Distributed Cloud Services Platform

Build scaling into your founding DNA

One of the learnings Ankur brought from Contrail was that it becomes dramatically easier to scale the business if the product is easy for customers to operationalize — most infrastructure solutions are complex as they require integration of many services.  Another was that distribution strategy (sales partnerships, open source communities, freemium) should be part of the initial product development strategy. Many technical entrepreneurs make the mistake of underestimating the importance of incorporating distribution and sales scalability in the design + engineering of the product itself. Ankur had learned hands-on that the earlier you start thinking about it and ensuring that the engineering team understands and is aware of the tradeoffs, the easier it will be to scale your business in the future. This has become especially important with the increase in bottoms-up decision making in enterprise technology, as changes to distribution strategy can have a significant impact on product + engineering.

A culture of transparency is key to team building

Ankur realized that when you decide to tackle a really complex problem, your culture requires some of the best brains to come together and work as a family with complete transparency of information. While Ankur hired from his longtime team of senior innovators, he also had to find best-in-class specialists (experts in building + operating a global network and SRE engineers for operating a distributed cloud) to address immediate customer needs.  This culture of transparency and collaboration enabled Volterra to expand its workforce in different time zones across Europe, Asia and the US early in their trajectory.  With the onset of Covid-19, they were able to pivot to a remote-first model quickly, further increasing productivity and serving customers 24×7.

Learn how to leverage your founding investor

As a repeat and successful entrepreneur, Ankur was very clear about the most important criteria in choosing his Series A investor. He knew it had to be someone who was a critical thinker and company builder, who could spend the quality time needed to understand his business, and who practiced radical candor while being loyal to a fault.  One example of our collaboration was around Volterra’s decision on whether to build or buy a global infrastructure network.  We had many whiteboard sessions and finally decided to acquire a team in France, and put together the financing needed to complete the acquisition.  His team was also able to tap into our CXO network to get early feedback on their product which guided critical product decisions. And because we had established a zone of trust early, he felt comfortable making the first call to us at key inflection points, including when he evaluated the M&A path.  

Picking the right partner can accelerate your mission

F5 Networks allows Volterra to quickly scale their reach with a sales force that is trained in application security, networking and services.  In addition, Volterra can add more capabilities to its SaaS service with F5’s products.  Unlike traditional IT infrastructure vendors that are trying to modernize and cloudify their legacy offerings, and newer service providers who choose time-to-market with “maybe good enough” services, Volterra + F5 will provide both best-in-class capabilities and cloud-native agility via a SaaS platform and global network for deploying, connecting, securing, and scaling modern + existing business apps across multi-cloud and edge environments. Through the companies’ combined and broadly expanded joint service portfolio, enterprises around the world will be able to accelerate their applications’ time-to-service, decrease total cost of ownership by consolidating vendors/services and simplifying operations via SaaS, and delight end users with extraordinary digital experiences. 

Please join me in congratulating Ankur, Harshad and the Volterra team on this milestone.