HighBar Partners and Virtual Instruments: Catalysts in driving true end-to-end performance visibility

Following is a guest post by John Kim, co-founder and managing partner, HighBar Partners, discussing the firm’s work with its portfolio companies and the quest to build an application-centric infrastructure performance management powerhouse – Virtual Instruments.

When HighBar Partners invested in Load DynamiX in 2014, we started on a path to enhance application delivery from a storage perspective. It was simple. Storage was more often than not the culprit behind application performance issues, and enterprises needed more sophisticated tools to understand the storage requirements of applications in order to deploy the most efficient and cost effective infrastructure. We also acknowledged more broadly as a firm (as many others have in our space) that cloud is revolutionizing IT infrastructure and the way that enterprises design the modern datacenter, with one caveat – timing.

While the longer term trend to cloud remains intact, on-premise IT has exhibited tremendous resilience and has undergone more of an evolution, with intermediate solutions that bridge the gap to cloud. The need for control and visibility continues to be paramount for application performance delivery in the near term, and while developers enhance user experience and application performance through APM and other design tools, they fall short of addressing the core infrastructure responsible for application delivery. Furthermore, the increasing complexity of the datacenter responsible for application performance is quickly moving beyond the limits of human control and will need to rely on machine learning and automation to monitor and identify root causes of slowdowns within next generation data centers. The proverbial needle in the haystack is becoming exponentially more difficult to find and less correlated to just the storage elements.

This nearer term conclusion led us to envision monitoring the datacenter in a more holistic fashion. HighBar was introduced to Virtual Instruments in 2015, and we quickly realized that while Virtual Instruments and Load DynamiX shared some subject matter overlap in storage, they were actually very different in their approaches and complementary from a resource and product standpoint. A broader product that covered both SAN and NAS with a path to network and compute coverage made a lot of sense in the context of a phenomenal combined customer base interested in a more comprehensive datacenter monitoring solution. While M&A integration is always challenging, the team at the “New Virtual Instruments” was able to bring the two companies together in a way that energized the combined employee base and leveraged the best discreet elements of each. The immediate result has created the leader in infrastructure performance management from the perspective of scale, profitability, and addressable market.

We have great customers. As the team continues to position the company for growth, engagement and collaboration with our customer base is essential to defining the product roadmap most critical to the continued evolution of IT infrastructure, whether it be on-premise, in the cloud or a hybrid thereof. In doing so, we acknowledge that our customers are at the forefront of this evolution, love our products and are looking to us, a collaborative partner, to help make these difficult decisions going forward. In the meantime, we surveyed the landscape of software companies who claim to provide end-to-end infrastructure monitoring and have found that most of these claims are marketing driven while the products themselves only focus on a specific subset of the datacenter. We wanted a broader solution with a comprehensive real-time view of storage, networking and compute, and after investing a significant amount of time evaluating what the market had to offer today, we concluded that the solution was something that we would have to acquire and/or develop ourselves. Xangati, in this regard, was an excellent candidate to accelerate our vision to fulfill customer needs across the datacenter and cloud fabrics. Xangati’s real-time, agentless platform gives IT managers a holistic view into application performance in hybrid, on-premise and cloud environments and is core to our investment thesis. The acquisition of Xangati by Virtual Instruments closed in October 2016 and made a lot of sense in this context.

Virtual Instruments is now the only end-to-end provider of application-centric infrastructure performance management with a depth of knowledge in storage, networking and compute. Our higher order goal is to provide IT organizations with the ability to operate more efficiently by identifying and remediating application performance issues within the infrastructure in real-time – we help them find the needle in the ever growing haystack within the datacenter and automate the remediation. Our existing partners and customers have continued to have trust in our business as we expand our coverage and bring new products to market. There is still a lot of work to be done, but we are up to the challenge as a category leader and formidable competitor. At HighBar, we consider ourselves not only an investor in technology business but also a partner. Virtual Instruments is a great example of our collaborative nature, and we are proud to be involved in this endeavor.

John Kim is a co-founder and managing partner of HighBar Partners, a private investment firm focused on enterprise and infrastructure software companies undergoing change or transition. HighBar provides patient, long-term capital and resources to fund growth and assist management teams with financial, strategic and operational execution. Mr. Kim’s current and past directorships at HighBar include Virtual Instruments, Janrain, Clustrix, Zettaset, Soonr (acquired by Autotask) and Vyatta (acquired by Brocade).