What’s with Isilon?
They haven’t reported financials for almost 3 quarters. Their stock is trading at about 20% of its peak. They fired their CEO and put founder Sujal Patel in his place. And NetApp was trying to strangle baby Isilon (see NetApp filers for $1/GB?) in its crib.
Are they goners?
I don’t think so.
I’ve been trying to read the tea leaves on the Peter van Oppen’s decision to join the board earlier this month.
Peter led the tape library company ADIC, also based in the Seattle area, for 12 years until its sale to Quantum. ADIC out-innovated Quantum - saddled with a cranky and slow DLT development group - in libraries and software as well.
If you think the folks who buy storage arrays are conservative, you haven’t sold any tape libraries. It is a tough market and ADIC did well.
So why would van Oppen join a sinking ship?
That’s why I don’t think Isilon is sinking. An external audit team is reviewing Isilon’s accounting to ensure that any financial dirty laundry - say, hypothetically, channel stuffing - gets cleaned up. They’ve been at it for months and must be about done.
The StorageMojo take
Based on the Isilon press release and pure speculation, here’s what I think is going down:
- Peter exercised some due diligence before accepting the directorship and isn’t terribly worried about the basic health of the company
- After he gets up to speed on company operations, he assumes the CEO role by July
- Sujal happily goes back to one of the best jobs in any company: CTO and Founder while the stock climbs in value
However it goes down, getting Peter on board is a real plus. Storage experience is thin in Seattle. Isilon has lots of smart people, but the storage market has many unique wrinkles that networking or software folks take a long time to learn.
Comments welcome, as always. Disclosure: I met Sujal 7 years ago and I’ve done some work for Isilon. I hope they do well.
on February 23rd, 2008 at 3:19 pm
I’ve been using isilon in production for over a year now, and their technology is really great. It shows great promise, and technical innovation. They are one of only a few companies that really might give NetApp a run for it’s money in the long run.
on February 26th, 2008 at 5:18 am
Robin,
Good insights and yes, I agree with you
Do you own Isilon stock?
on February 26th, 2008 at 6:42 am
Blake, I think the entire file serving business is going to become even more competitive, especially with EMC’s Maui project. I’m glad the Isilon product is working well for you.
Victor, I hope no one assumes I am offering any sort of investment advice, because I’m not. My focus is the intersection of product markets, technology and customer needs. I have no inside info from the company nor do I know Peter van Oppen personally. I’m speculating about what his joining the company means and he may not be as smart as I think. I don’t own Isilon stock.
Robin