Cloud Computing Software Startup Company Opscode Raises $19.5M

Venture money continues to pour into cloud computing startups. The latest news in venture financing for cloud computing is an investment worth $19.5 million into Opscode by a group of venture capital firms led by Ignition Partners of Bellevue.

Seattle-based Opscode provides cloud-computing software. Opscode is the creator of Chef, an open-sourced line of software that lets IT professionals to put up and even modify their cloud-computing resources instantly with a great number of available options.

This is an important IT service because the business computing world has been changing quickly in recent years. In the past, a small number of large vendors provided end-to-end services; today, on the other hand, services have been cut up into smaller tasks, which are now being offered by a hundred different players of various company sizes. At the same time, the amount of storage and computing power that businesses need to continue running are quickly ballooning as the amount of data available likewise continues its rapid increase.

One of the biggest reasons why Opscode’s Chef software is doing so well is that fact that it’s open-source. This allows an entire community of gifted IT professionals to create new ways of using the tools. It’s entirely possible for an IT expert to figure out a way to make Chef do exactly what the community wants, thus contributing to what Opscode has dubbed “the cookbooks.”

In 2010, Opscode began to gain revenue from its Hosted Chef service. In 2011, it launched the Private Chef, which gives the IT managers of big businesses more options and flexibility for keeping their companies’ important data better protected behind their corporate firewall.

Opscode says that, in fact, it has hundreds of paying customers. Private Chef has been installed more than a dozen times, and more and more people are downloading the software as well as contributing to the open-source community of the company, encouraging Opscode to hold its first users conference in spring.

Naturally, in an industry that is growing as quickly as this, the little players have a greater tendency to be pushed out by the bigger folks. If you do too well, you’ll soon find yourself bought out by a big cloud-computing company such as Microsoft or Amazon. On the other hand, you could always do badly – in which case, you could survive as an off-brand provider.

Yash Talreja, VP Engineering, The Technology Gurus