FORTUNE — Riverbed Technology (RVBD) makes gear that improves the performance of data and applications as they traverse far-flung corporate networks. Thanks to Riverbed’s technology, a salesman in Tokyo firing up a SharePoint application that’s actually sitting on a server in London experiences fewer slowdowns and less latency as he scrolls through his presentation. Co-founded and led by Motorola and Inktomi veteran Jerry Kennelly, Riverbed launched in 2002 and posted $726 million in revenue last year. Some 17,000 organizations have installed Riverbed boxes in their networks since 2004, according to the company. “Their installed base is a competitive advantage,” says Morningstar analyst Grady Burkett. Among the ways Riverbed’s technology improves network performance: It eliminates unnecessary traffic and prioritizes data delivery according to customer requirements. As enterprise computing moves to the cloud and emphasizes real-time collaboration via web-based applications, Riverbed is investing heavily in related products like network-management software. “When the cloud market really explodes, we’ll be there,” says Kennelly.
HQ: San Francisco
Employees: 1,674
The Business: Technology that boosts software performance on wide-area networks
Risk/return: Right now Riverbed is the big dog in the wide-area network (WAN) optimization market, with a 50% share. CEO Jerry Kennelly faces serious competition from giants like Cisco (CSCO) and Citrix (CTXS), as well as upstarts like F5 (FFIV). And some analysts think Riverbed’s technology solves a problem that won’t exist much longer, given that most applications now are already optimized for use on networks. “They’re venturing into new areas,” says Bank of America analyst Tal Liani. “But how long will it take to see if they’re successful?” Still, the gathering flood of online data continues to clog networks worldwide, suggesting continued opportunities for Riverbed.
This story is from the July 2, 2012 issue of Coins2Day .
