Here's how VMware is putting its $550 million acquisition of Heptio to work as it builds a new future around Kubernetes, the red-hot cloud software created by Google

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Here's how VMware is putting its $550 million acquisition of Heptio to work as it builds a new future around Kubernetes, the red-hot cloud software created by Google

Heptio Beda McLuckie

Heptio

Heptio co-founders Joe Beda and Craig McLuckie

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  • Last December, VMware acquired the startup Heptio for $550 million.
  • Heptio provides support for the open source cloud project Kubernetes. That made it a good fit for VMware, which was looking to build more Kubernetes products to support customers moving to the cloud.
  • VMware has even become the #2 code contributor to the Kubernetes project, second to Google, where the project originated.
  • At its VMworld conference, VMware introduced new Kubernetes products, some of which use Heptio's technology.
  • This is all important for VMware: Kubernetes could provide a viable alternative to the virtualization technology that made VMware a household name in the IT industry, and the company is trying to stay ahead of the curve.
  • Click here for more BI Prime stories.

Last December, VMware acquired a small, 100-person startup called Heptio for $550 million.

Despite its size, Heptio has already made a major splash among developers. Its co-founders, Craig McLuckie and Joe Beda, were two of the creators of Kubernetes, a cloud project that started when they were still at Google.

One of the fastest-growing software projects of all time, Kubernetes helps developers easily move their applications between the cloud and private data centers, and then manage their applications running at massive scales. And, since 2014, the Kubernetes code has been available as open source, meaning it's free for anyone to use, download or modify, giving rise to a massive community.

Joe_Beda_color

VMware

Joe Beda, co-founder of Heptio and Kubernetes

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McLuckie and Beda eventually left Google to start Heptio, which offers products and support to help make Kubernetes more friendly to businesses. Now, over eight months after Heptio came to VMware, McLuckie says that so far, they're a natural fit - namely because of the "deep engineering culture" that they share.

"When you're a startup founder, you have a choice to make: Are you buying into a vision or selling out?" McLuckie, now vice president of R&D at VMware, told Business Insider.

To that point, he says, VMware is giving Heptio the resources it needs to really dig in on Kubernetes.

"When you're a small startup with a relatively modest team, there are very few things to move the state of the art forward," McLuckie said. "VMware has a very strong engineering culture. The quality of engineers here is as good as anything I've seen in the industry. When you're a little startup, everything you do, you have to build from the ground up."

Craig McLuckie (3)

VMware

Craig McLuckie, co-founder of Heptio and vice president of R&D at VMware

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The future of VMware

For VMware's part, Kubernetes itself is a big bet on the future of the company.

VMware made its name with a technology called virtualization, which allows for a physical server to be chopped up into any number of so-called "virtual machines," making more efficient use of its resources. It's one of the foundational technologies of modern cloud computing, allowing companies like Amazon or Microsoft to serve millions of customers from their hyper-efficient data centers.

However, Kubernetes, and technologies like it, are changing the game. The underlying technology here is called "containers," allowing developers to easily pack applications up such that they run exactly the same on their MacBook as they do on a massive cloud. It's a simple, but powerful idea - and one that some people think could one day replace virtualization, especially when building cloud software.

And so, the company has been doubling down on Kubernetes, to stay ahead of the curve. VMware has been contributing even more code to the Kubernetes project. Today, VMware has become the #2 contributor to Kubernetes - second only to Google, where the project originated.

Read more: Everything you need to know about Kubernetes, the Google-created open source software so popular even Microsoft and Amazon had to adopt it

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VMware has put more money where its mouth is, as well: In the time since Business Insider's conversation with Heptio, VMware announced the $2.7 billion acquisition of developer software company Pivotal - which, like VMware itself, is a subsidiary of Dell. Pivotal, too, has its own Kubernetes technology to bring to the table.

VMware's big push towards Kubernetes

Even before Heptio came along, VMware had been slowly integrating Kubernetes support into core products like vSphere. Still, VMware was looking for people or startups that could bring in more perspective on the technology, McLuckie says.

Now settled in at VMware, Heptio is hard at work using its Kubernetes engineering expertise to help customers get started, even as they influence the direction of the new parent company's product lines.

For example, this week, VMware introduced a new product at its VMworld conference called Tanzu Mission Control, which came out of a project that Heptio started before its acquisition. It allows companies to manage, secure, and monitor their Kubernetes applications.

Several of VMware's products now incorporate Heptio's technology, too, like Enterprise PKS and Cloud PKS, two services to help VMware customers manage Kubernetes, right alongside their more traditional VMware infrastructure. And subscriptions to Heptio's support services are also accessible to VMware customers.

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Paul Fazzone, senior vice president and general manager at VMware, says that all of VMware's major product groups are participating in contributing code to the main Kubernetes project. It's also investing in features that large companies care about, like compliance with security and regulatory requirements.

Headshot Paul Fazzone VMware

VMware

Paul Fazzone, senior vice president and general manager at VMware

"We're able to bring some of the foremost Kubernetes experts on the planet," Fazzone told Business Insider. "That's incredibly valuable to our customers. They're on budget constraints. They're implementing a technology for the first time. They want to look good to their boss."

'It has certainly changed the game'

Fazzone says the first six months post-acquisition were about bringing together its teams in a "thoughtful" way. Together, they looked at what VMware was building and what Heptio was building to figure out how both teams could complement each other's efforts.

Now, they're focusing on building products, as well as engaging with and educating customers.

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"Now that we have the team fully integrated and settled down, I'm really excited about the caliber of external product and engineering talent we're able to integrate into the team," Fazzone said. "I'm really excited for the next two years, being heads down, building great products, delighting our customers, and emerging as clear leaders in this category."

Back when Heptio was still on its own, McLuckie says that as he looked at the work that needed to be done to support business customers, and he realized Heptio wasn't going to be able to fully help enterprises on his own. That's where VMware came in.

One of the best things about the acquisition, is having access to even more engineering resources, not to mention sales and marketing capabilities, McLuckie says. He says it has "changed the game," and now, Heptio has an even more global reach.

And although Heptio was founded by the creators of Kubernetes, McLuckie says that VMware has boosted its credibility even further.

"When you're a 100-person startup and show up at a bank and say, 'We can do that,' there were a number of organizations who were willing to take a bet on us," McLuckie. "Now, the credibility goes up so much more. For me, it certainly has changed the game. I don't have to explain who we are."

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