Deutsche Telekom eyes up SD-WAN investment

Software-defined WAN provider Aryaka announced the completion of $45 million Series D round of financing, attracting Deutsche Telekom Capital Partners among other names.

The funding from Deutsche Telekom is claimed to be the first telco investment in an SD-WAN technology by a major telco, joining an already heavy weight group of investors including Amazon, Microsoft and Google. Aryaka boasts some pretty impressive figures, growing at more than 100% for five consecutive years and customers in 63 countries around the world, and the funding will be used to help ‘Aryaka aggressively expand its global reach’.

“When we look at companies that we want to invest in, we consider market, technology, and team,” said Robert Schwartz, Managing Partner of Third Point Ventures, the company leading the investment. “Aryaka is positioned perfectly at the tipping point of an enormous marketplace that is moving away from legacy MPLS technology and looking into next-generation solutions to help connect seamlessly worldwide to business-critical applications.

“In addition, the management team of Aryaka has built a critical base on which they can execute on the promise of their SD-WAN technology. We are excited to be partnering with a company that is on a rapid trajectory of growth such as Aryaka.”

The technology itself is a specific application of SDN technology applied to WAN connections, which are used to connect enterprise networks. Whether it be branch offices or data centres, SDN-WAN is an on-demand service which means enterprise customers have an alternative option to building their own networks between sites. The technology is a fast growing area in the connected era, due to the flexibility and the on-demand economics.

While Aryaka does seem to be making a strong statement in the SD-WAN segment, it is by no means alone. Cisco, Juniper, Riverbed and Silver Stream are all carving out useful reputations, taking advantage of challenges put in place by MPLS technologies which are struggling under the demand of supporting modern, cloud-centric enterprise networks.

The segment is looking quite congested already, attracting the interest of some industry giants, but the support of some major players, including Europe’s largest operator, certainly puts Aryaka in a strong position.