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(Reuters) - Nexenta Systems Inc, a data storage software maker, said it plans to go public by the end of 2015 as it looks to cash in on investors' appetite for companies that help businesses cut costs.
Nexenta makes open source-based "software-defined storage", which a client uses to save data on hardware from other vendors, thereby avoiding costly 'package deals' that require buying hardware and software from the same vendor such as NetApp Inc or EMC Corp.
The demand for its expertise has helped double Nexenta's annual revenue in the last three years and the nine-year old company is expected to post a profit as early as end of this year, Chief Executive Tarkan Maner told Reuters.
"We want to make sure the company grows ten-fold in the next three years; we want to grow ten-fold in terms of customer size," said Maner, who took over the top job in August last year.
The spending on storage management software is expected to rise to about $22 billion in 2017 from $16 billion in 2013 - a growth rate of about 37 percent, which outstrips the expected 28 percent growth in overall enterprise software spending for the same period, according to research firm Gartner.
The strong demand for overall enterprise software led to successful initial public offerings over the past year for companies such as Tableau Software Inc, Veeva Systems Inc, and Nimble Storage Inc.
Santa Clara, California-based Nexenta has about 5,000 customers, including GoDaddy, AOL Inc and Softbank Corp, and manages storage of one exabyte - roughly equivalent to the data in 250 million DVDs.
However, Maner said Nexenta's annual revenue was yet to touch $100 million. He declined to divulge exact figures.
The company's previous CEO Mark Lockareff had said in February last year that Nexenta's revenue was in the "eight figure range", according to a report. (r.reuters.com/syk39v)
"We have been growing (revenue) at 100 percent year-on-year and want to continue that kind of growth rate at the minimum," Maner told Reuters.
But his company will face stiff competition from other open source-based "software-defined storage" makers ranging from established names such as Red Hat Inc to start-ups such as GreenBytes Inc and DataCore Software.
Since it was founded in 2005, Nexenta has raised $90 million from investors such as Western Digital Corp, Dell Inc and SanDisk Corp as well as venture capitalists including Sierra Ventures and Menlo Ventures.
Maner said Nexenta receives buyout overtures all the time, but the company's goal was to grow by raising funds through an IPO.
"We want a very successful public offering ... (to) fuel our growth in multiple technologies in various geographies."
Maner said Asia, from where 20 percent of the company's revenue comes, was the company's fastest growing market. The rest of the revenue was split between North America and the Europe, Middle East and Africa region.
Nexenta has about 200 employees worldwide who own a stake of about 50 percent in the company.
Editing by Savio D'Souza