Decision comes as hyperconverged infrastructure and cloud software vendor sees revenue grow and gets $750 million investment
Dheeraj Pandey, who co-founded Nutanix almost a dozen years ago, is stepping down as chairman and CEO once a successor is found.
The Lowdown: Pandey made his decision public this week, the same day that the San Jose, California-based company announced a $750 million investment by venture capital firm Bain Capital Private Equity and fiscal fourth-quarter revenue of $327.4 million, a 9% year-over-year increase. Full-year revenue hit more than $1.3 billion, up 6% from fiscal-year 2019.
The Details: Pandey said he was stepping down to spend more time with his family and pursue other interests that he didn’t have time for while building Nutanix into a software company with $1.6 billion in annual billings and a growing presence in the cloud market. He noted that spending the past several months working at home in the company of his family due to the COVID-19 pandemic was a “fulfilling experience.”
Nutanix started life as a pioneer in the nascent hyperconverged infrastructure space – where compute, networking, storage, virtualization, and management software are offered in a tightly integrated appliance – building software that could run on its own hardware or that of such vendors as Dell, Cisco, Lenovo, and Hewlett Packard Enterprise. Four years ago, the company under Pandey began an initiative to move beyond its hyperconverged roots and become a platform company focused on the hybrid cloud.
During the most recent quarter, Nutanix launched its solution on bare metal with Amazon Web Services. Nutanix Clusters on AWS offers a single software stack across clouds to support hybrid cloud and multicloud environments.
Like other infrastructure players, Nutanix has also put a greater emphasis on software subscriptions and recurring revenue in a cloud-centric world and has expanded its channel efforts to help with the transition. Subscriptions now account for 88% of total billings and 87% of total revenue.
Nutanix’s board of directors has created a search committee to work with an unidentified global executive search firm to find Pandey’s replacement. No timetable was given for the search.
The Impact: The investment by Bain Capital is aimed at helping Nutanix fund its growth initiatives. As part of the deal, Bain Capital Private Equity managing partners David Humphrey and Max de Groen will join Nutanix’s board after the transaction closes in late September.
Background: During Pandey’s tenure, Nutanix has grown into a company with more than 15,000 customers and 6,000 employees. It also has put a particular focus on the channel in recent months, filling such key roles as senior vice president of worldwide channels (Christian Alvarez) and head of channel sales in the Americas (Christian Goffi).
The Buzz: “Co-founding and leading Nutanix for the last 11 years has been the single most rewarding experience of my professional career. Guided by a vision of making IT infrastructure so simple that it becomes invisible, our team has built Nutanix into a leader in cloud software and a pioneer in hybrid cloud infrastructure solutions,” Pandey said. “Thanks to the dedication of our talented team of over 6,000 employees, we have grown Nutanix through innovation and collaboration and built an incredibly strong and loyal customer base. While I will miss being in the trenches with our team every day, working from home alongside my family over the last several months has been a fulfilling experience. I look forward to spending more time with our children and allowing myself the space and flexibility to read and write, and learn new domains, which simply hasn’t been possible as a full-time CEO.”
“Silicon Valley’s history is filled with storied founders and legendary visionaries and Dheeraj Pandey has earned a place among them,” said Ravi Mhatre, lead independent director for Nutanix. “On behalf of the entire board, I thank Dheeraj for his vision and invaluable contributions, which have enabled Nutanix to grow from a simple idea to the market leader and successful company it is today. We support his decision to begin another chapter and deeply appreciate that he will continue to lead the management team until a successor has been appointed.”
“Nutanix is executing on a compelling vision for a differentiated hybrid cloud platform that provides flexible environments and is easily paired with other cloud platforms,” said David Humphrey, a managing director at Bain Capital Private Equity.