Viridity Software Raises $8M for Server Efficiency

Viridity Software says it can take the sensors out of data center energy management. On Thursday, the Burlington, Mass.-based startup announced it has raised an $8 million second round of funding from Battery Ventures and North Bridge Venture Partners to take that idea to market.

Viridity’s EnergyCenter software can start delivering per-server power usage and utilization information, along with a host of other data, within hours of being installed. That’s all at a cost of $500 per rack, according to Michael Tresh, director of product development.

Viridity (not to be confused with smart grid software startup Viridity Energy) uses server power usage modeling and server utilization data to target what Tresh called the “low-hanging fruit” in data center power waste — primarily older power-hungry servers that need to be replaced, and servers that are being underutilized. EnergyCenter also delivers information and advice on the best way to physically organize servers in a data center, and now has clients including LexisNexis, Highbridge Capital and F5 Networks.

The software-only approach differs from a host of other data center efficiency startups, such as Arch Rock, Sentilla and Synapsense that have focused on using wireless sensors to collect data. The main benefit to Viridity’s approach is lower cost, Tresh said.

On the other hand, sensors can deliver information that software alone may not be able to, such as temperature and humidity data that can help data center operators fine-tune their cooling systems, which can account for up to half of a data center’s energy costs. As analyst Katherine Austin put it in a September GigaOM Pro report (subscription required), it’s difficult to make a decision on whether to shift cooling strategies or run data centers a few degrees hotter without real-time data to know which sections of the data center might be at risk of overheating.

Data centers used about 1.5 percent of electricity in the U.S. in 2006, but that share has been surging since then, driving data centers to seek out more ways to save power. Pike Research predicts that green data center equipment will grow from a $7.5 billion business today to $41.4 billion by 2015.

At the same time, power bills tend to make up less than 5 percent of a data center’s operating costs, making investment in saving power a difficult call, particularly in today’s tough economic times, said Martin Reynolds, VP at Gartner Research. One exception is when a data center finds it can’t expand because it has maxed out the power available at its location, he noted.

Where are data centers concentrating their efficiency efforts? Last month, research firm Forrester reported that 70 percent of companies are already taking energy-saving steps such as virtualizing servers. Pike Research said that power and cooling infrastructure will make up the largest portion of the green data center market with 46 percent of the revenue, while energy-efficient IT equipment will generate 41 percent of the revenue, and monitoring and management will grab 14 percent.

As for how startups in the space will fare, Reynolds predicted most will be acquisition targets. Giant power company Eaton (s ETN) announced plans to acquire data center energy management hardware company Wright Line Holding earlier this month, and last month, General Electric (s GE) said it invested in SynapSense. Reynolds noted that HP (s HPq), IBM (s IBM) and VMware (s VMW) are working on integrating energy management with their data center IT equipment management platforms as well.

For more information on green data centers, read (subscription required):

Report: Green Data Center Design Strategies

Image courtesy of Viridity Software.