A startup that was born out of the pain of building Apple's network has raised $25 million

SnapRoute, the startup created from Apple's former data center networking team, has raised a healthy series A round of financing of $25 million, led by Rama Sekhar Norwest Venture Partners.

SnapRoute seemed to come from nowhere last year to take the computer network world by storm, launching a software product that is doing well with Facebook's growing family of Open Compute Project computer switches.

It created so much buzz that it actually knocked Hewlett Packard Enterprise out from leading HPE's own open source "OpenSwitch" project when the would-be customers of OpenSwitch voted to ditch HPE's software and replace it with SnapRoute's.

Raising money wasn't a problem. VCs were throwing themselves at the 35-person startup, whose cofounders consist of the startup's CEO Jason Forrester, director of engineering Adam Casella and director of customer experience Glenn Sullivan.

"We had seven Tier 1 VCs wanting to lead the investment," Forrester said, admitting he was slow to call them all back. "One of them wanted in so badly, they tracked down my landlord to broker the meeting."

In the end, he got them all in a bidding war and wound up with terms and a valuation that appealed to him. (He wouldn't disclose, but we'll update this post with the details when we find out.)

"In my opinion the VCs are flush with cash right now. A lot of major funds are raising huge amounts, but deal flow is mediocre at best. So if you're a startup right now, and you have signs of life and paying customers, you can walk in and call your own terms," he says.

The pain of building Apple's demanding network

But the allure also has to do with this particular startup.

Before founding SnapRoute in 2015, the founders worked at Apple building the company's data center network, the one that supports huge internet services like iTunes, iCloud, Siri and the App Store.

It was the pain of building an enormous-yet-reliable network that drove them to develop this product, Forrester tells us.

"Apple is a great place to work. We met a lot of talented people, really amazing folks changing the world every day there," he said.

But "we left because every day we were called into principal's office because of some bug with the incumbents products. When you pour your heart and soul into the infrastructure, and do everything you can to make it useful and then it crumbles and is brittle, just the sheer getting beat-up everyday gave us the strong desire to finally change things in the network space."

There's another aspect to their history, which we've previously reported. Word among the network industry is that this team all quit the same week in large part because Apple's culture of secrecy forbade them from openly collaborating with other network engineers outside of Apple. (Forrester wouldn't dish about that.)

SnapRoute offers a network operating system. That's software that runs on what's known as commodity or "white box" switches. These are inexpensive network switches built with off-the-shelf, easily replaceable parts, as opposed to the highly integrated, custom chips and boards that Cisco and Juniper use in their products.

White box hardware is what Facebook's OCP is working on, but low-end switches are also available from other sources, like Chinese manufacturers.

SnapRoute's claim to fame is that it's highly customizable. A company can install just the individual features it needs. SnapRoute promises to fix bugs within 24 hours, "which is unheard of in the network space," he says.

Competition heating up

SnapRoute isn't the only the startup out there taking on Cisco by offering a network operating system that works with less expensive hardware (although its choose-a-feature bit is unique). A startup called Cumulus Networks, founded by a former Cisco engineer JR Rivers, is a direct competitor, been around for longer and has over 500 customers, Rivers tells us.

And then there's Arista Networks, the public company founded by a host of ex-Cisco stars and billionaires Andy Bechtolsheim and David Cheriton. Cisco filed a bunch of lawsuits against Arista over patent infringement claims, but that hasn't seemed to stop Arista from winning lots of business.

VMware is also a huge competitor, and just announced it's network software, NSX, is on track to do $1 billion in the next year. And there are a handful of other startups like Pluribus Networks, led by another former Cisco star engineer, Kumar Srikantan and backed by Yahoo founder Jerry Yang.

Including SnapRoute's, $4.5 million seed round led by Lightspeed, the 35-person startup has now raised $29.5 million. In addition to Norwest, other investors in this round include Lightspeed, AT&T and Microsoft Ventures.