Tech heads who’ve been following cloud computing from its humble beginnings may recognize Nirvanix as one of its early pioneers. The San Diego-based company was a storage partner of computer veteran IBM, but made a name for itself by delivering public, private, and hybrid cloud solutions to its own flock of customers. Unfortunately, this seasoned vendor recently became one of the latest technology companies to fumble its way out of existence.
On the 16th of September, Nirvanix notified customers that they had roughly two weeks to pack up their data and move on. Come September 28, the company pulled the plug on its website and days later, revealed that it was filing a Chapter 11 bankruptcy. Nirvanix did the honorable thing by giving users an additional two weeks to get their data together, but also left thousands of clients out in the cold with no cloud to comfort their IT needs.
The demise of Nirvanix represents a major concern many organizations today share – an IT service provider that is here one day and gone the next. Above all, it underlines the importance of dedicating due diligence to choosing the right vendor from the start.
Examine Their Track Record
Founded in 2007, Nirvanix previously existed as StreamLoad, one of the early online storage providers. The company was initially known for a product called MediaMax, often considered a social network for file storage and sharing. MediaMax was a big hit with users, but marred in controversy due to its mishandling of user data. When MediaMax shut down in 2008, it had already been repackaged as LinkUp, the brand that shouldered most of the blame for causing an estimated 20,000 customers to permanently lose their data. This incident is remembered as one of the biggest failures resulting in data loss in internet history.
Track record is one of the most important factors to consider when evaluating an IT service provider. A vendor can boast all sorts of claims, but what does their history reveal? Are there any red flags that warrant concern? As a potential customer, it’s absolutely critical to examine a company beyond the hype and testimonials to get closer to the real picture. Hindsight is 20/20, of course, but had customers peeked deep enough into Nirvanix’s past, they may have seen a troubled vendor that was destined for doom.
Check Into Leadership
Factoring in its run as a relatively successful online storage service, it’s safe to conclude that Nirvanix had the expertise necessary to dabble in cloud solutions. Solid leadership, on the other hand, appears to be something it lacked. The company reportedly changed CEOs five times since 2008, including three times in the past year alone. Leadership is a crucial element of business that speaks to stability, vision, and growth potential. Poor leadership has befallen the biggest of giants, so if your research uncovers problems at the helm, it may be a sign to stay away.
Look Beyond SLAs
Keeping a close eye on service level agreements is essential when shopping for IT services as they outline how you will be accommodated should the vendor fail to meet their specified uptime. Unfortunately, SLAs and the guarantees that accompany them are null and void when a vendor goes out of business. Therefore, you need to understand what happens to your data should your IT partner bite the big one. Can you reclaim your data with no ownership issues? How easy is it to transfer your data to another platform? Can you trust the vendor to scrub all your data from their servers once they pull the plug?
Evaluate Financial Status
Little has been revealed regarding why Nirvanix flopped, but money or lack thereof is often tied to failed business ventures. The company raised more than $70 million during its six year run, including a whopping $25 million round awarded just last year. But filing bankruptcy is a telling sign that Nirvanix struggled to maintain the cashflow needed to operate a cloud service, which is not cheap by any means. Before entrusting your IT assets in the hands of any vendor, you need to make sure they are financially stable. The state of finances past and present will give you an idea if they can support your needs in the future.
Keep a Backup Plan
The cloud makes a fine addition to any backup and disaster recovery plan. However, the Nirvanix closure reminds us why it should never be your only option. Instead of storing your data in a single location with a single vendor, perform backups at the local level so you can quickly recover even if your service provider is no longer operating. You may also want to consider using an additional storage platform with a separate vendor for the same reasons. With the platform closed for business, Nirvanix customers may still be challenged in disaster recovery efforts despite having access to their data.
I don’t think anyone could have predicted that Nirvanix would be out of business and heading into bankruptcy around this time last year. While situations like this are almost impossible predict, you can reduce the likelihood of ending up a similar predicament by thoroughly researching prospective providers and making the proper preparations ahead of time.