Posted on November 2014 | Aziz Gilani

Why we invested in Graylog

In October 2014, Mercury made its initial investment in Graylog, the leading open source log management alternative to Splunk.  We led Graylog’s Series A preferred round of financing with co-investment from Crosslink CapitalDraper Associates, and existing seed investor HTGF.  The investment was the culmination of a lot of hard work going back to our initial meeting with Graylog founder Lennart Koopman in the summer of 2014.  We met Lennart through Moshe Bar of Texas Atlantic Partners.  Moshe, a repeat entrepreneur with a deep background in DevOps and Open Source (XenSource, acq. by Citrix; and Qumranet, acq. by RedHat) had identified Graylog in Hamburg, Germany.  Moshe seeded the Company with, and was now looking to relocate its headquarters to the U.S. and install a startup CEO. We immediately introduced the company to Houston-based software executive Michael Sklar, due to his background in DevOps (AOG, acq. by VMware), and he quickly joined the company as CEO.

After Michael joined the Company, Mercury made its initial investment.  In conjunction with our investment, Graylog launched their new Houston HQ where sales and marketing are based. Houston has a long heritage of DevOps and network/systems management expertise, starting with the launch of BMC Software through the present with cloud-based security platform provider, Alert Logic.

In 2010, when Mercury led a Series A round in Austin-based Infochimps (acq. by CSC), ‘Big Data’ was still a novel phrase used primarily by physics PhD students and employees of silicon valley-based search engine companies. Today, enterprises have a deep need for tools to help them ingest and rationalize the massive flow of log data from devices, customer applications, servers, firewalls, and thousands of other sources – many of which are introduced daily.  Big Data analytics tools are no longer a skunk works project – they are a business necessity. Closed source tools like Splunk do a laudable job of helping the enterprise analyze their data, but require months – if not years – to get budget approval to pay for their hefty price tags.

The current slate of open source alternatives perform adequately in certain situations, but require hefty effort to initially set up. Later, the challenge shifts to ease of scaling and management. What attracted us to Graylog is that it is purpose-built for centralizing and analyzing log data, which has enabled it to be the easiest and most affordable solution on the market today. Graylog can be installed in as little as 15 minutes, and scales up to collect terabytes of data per day without a hitch.

Encapsulating the most popular open source projects – Elasticsearch and MongoDB – Graylog uses the right tools for the right job.  The market seems to agree, with active Graylog clusters more than doubling in 2015.  Mercury is excited to join the Company in what should prove to be an exciting ride!

You can read more about our investment in Graylog here.

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