Aerohive Networks could get acquired

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Aerohive Networks could get acquired

Aerohive Networks, one of the last standalone vendors in the market, is striving to remain independent with networking pure-plays Aruba Networks, Ruckus Wireless and Meru Networks being swallowed up by larger companies like Hewlett Packard Enterprise.

"If you look at the way technology marketplaces evolve, there are some patterns around consolidation, but the innovation comes from the standalone guys, it's not coming [from] the behemoths," said David Greene, chief marketing officer at Aerohive, in an interview with CRN USA. "We want to leverage our independent status as a platform to driving innovation and driving growth and helping to point out some of the ways the industry can evolve going forward."

As bandwidth needs increase at a blistering pace and the internet of things market begins to blossom, vendors have scooped up networking companies at a blistering pace.

Within the past 20 months, HPE bought Aruba for $3 billion, Fortinet acquired Meru for $44 million and Brocade Communications nabbed Ruckus for $1.2 billion. Brocade itself is being acquired by an even larger company, Broadcom, for $5.9 billion. Broadcom plans to divest Brocade's networking business, leaving only a handful of recognizable players in the market.  

Greene said that although there has been plenty of speculation this year about potential buyers for Milpitas-based Aerohive, the company is looking to stay an independent innovator, providing differentiation for the channel.

"Our intent is to remain independent," said Greene. "We are the fastest growing wi-fi vendor this year. We were the fastest growing wi-fi vendor in our space."

"So we continue to see momentum towards us driven largely by our partners who say, 'Hey, there's something different here. There's a different way of thinking here, a different opportunity to engage with the vendor and there's a different way of thinking about the solution that I'm going to get [compared to] if I go buy a big Cisco or HP solution,'" said Greene. "We think that's a very nice premise for growth and our board of directors and investors view that as well."

For the first three quarters of its current fiscal year, Aerohive captured a combined US$128 million in revenue, up from US$105 million compared to the same three quarters in 2015. The company's market cap sits at US$305 million.

Aerohive's specialty is in the education market, where it's seeking to win a chunk of the federal government's US$6 billion E-Rate program in 2017, according to Greene. The US$6 billion will be spent next year to update and enhance networking technology in underdeveloped schools across the country.

Greene said being an independent vendor allows Aerohive's channel partners to sell differentiated solutions in a consolidated market.  

"The partner who just wants to sell a lot of generic stuff with no value-added, those aren’t the partners getting excited about Aerohive. The partners who are excited about Aerohive are the partners who see, 'I want an offering that has a different architecture that is forward looking, things like SD-LAN that are helping me as a partner develop a services business as a complement to my resell business.' … Our technology foundation allows us both to go to a customer with a compelling value proposition."

This article originally appeared at crn.com

 

Copyright © 2016 The Channel Company, LLC. All rights reserved.
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