The Boston Globe reported that startup Cereva Networks has made some major changes. Cereva removed CEO Alan Lutz and named board member Mahesh Ganmukhi to succeed him. The company also replaced two members of its board of directors. Joining the board are two people with extensive venture capital experience: Paul Ferri, of Matrix Partners, and Ed Anderson, of North Bridge Venture Partners.
Founded in 1998, Cereva has been successful at raising startup capital. Red Herring Magazine selected Cereva as one of the top 50 private US companies. The company originally positioned itself as an Internet infrastructure company and claimed to have raised $110 million in financing. Now Cereva calls itself a storage systems company, making the changes at the top (in addition to delayed product introductions) somewhat ominous.
The Boston Globe wrote, "The extent of the issues at Cereva weren't clear. . . . Jamie Gruener, a senior analyst at the Yankee Group, a Boston research firm, said the many storage start-ups of the past 2 years are facing difficult times. Not only are their potential customers spending less money in the slower economy but, as with other sectors in high-tech, there are too many companies chasing the prize. 'It's a really tumultuous time, and I think we're going to see consolidation of these companies in the next 12 to 18 months,' Gruener said. Cereva's new CEO, Ganmukhi, said the company is working on a round of financing that it will announce in the near future. 'Going public,' he said, 'is further out.'"