Server maker Verari resurfaces under original founder

Contact: John Abbott

We noted last month that Verari Systems had run into trouble, and to avoid bankruptcy was planning to auction off its assets under an Assignment for the Benefit of Creditors agreement. The auction, run by the Credit Management Association, duly took place earlier this month. The successful bidder was none other than an investment group led by original founder Dave Driggers, who acquired ‘substantially’ all of Verari’s corporate and intellectual property assets. The company restarts under the modified name Verari Technologies, with less than one-third of the original headcount of 235, according to our understanding.

There are very few details of the transaction, and not many indications of how the new Verari will be different from – and avoid the same fate as – the old Verari. The fact remains that it’s very hard for a small company to compete in the hardware business against giants like IBM, Hewlett-Packard and Dell. The focus this time will be on datacenter design and optimization services, modular container-based datacenters, blade-based storage and high-performance computing, the vendor said in a statement. The new company now owns all of Verari’s inventory, equipment and technologies, and will immediately start supporting the existing installed base of Verari customers.

High-profile signup David Wright, previously at EMC, took over as CEO in 2006, while Driggers stayed on as CTO. The hints are that Verari will no longer try to compete in the general-purpose server and storage markets but will instead focus on niche segments, particularly those where customers require a degree of customization and consultancy, and work more closely with other industry partners. Those partners could include Cisco, which had been working with Verari on containerized datacenters before the crash. The new Verari will also work on licensing and promoting its patented intellectual property in areas such as system packaging (including blade chassis and containers) and vertical cooling.