DriveNets launches Network Cloud, raises $110M Series A at $500M+ valuation

Founded in late 2015, DriveNets operated in stealth as a bootstrapped company while the telecommunications industry faced a structural crisis: demand for data services kept rising, but customers' willingness to pay did not scale proportionally, squeezing service providers' margins.

Co-founders Ido Susan and Hillel Kobrinsky, both veterans with prior exits to Cisco ($475M) and AT&T ($121M), bet on a software-centric "Network Cloud" that runs on low-cost white-box hardware instead of proprietary routers. The architecture creates any network function from a single software stack and two generic hardware blocks, turning dedicated appliances into a shared, cloud-like resource.

The company won its first major contract in 2017 and grew to 150 employees with tens of millions in revenue before emerging from stealth. In February 2019, Bessemer Venture Partners and Pitango Growth led a $110M Series A valuing DriveNets at over half a billion dollars, validating the white-box disaggregation model.

With the new capital, DriveNets planned to hire 50 more people, expand its product portfolio, and enter global markets, positioning Network Cloud as the networking equivalent of what hyperscalers did for compute and storage in data centers.

$110M Series A, $500M+ valuation, tens of millions revenue, 150 employees

Traditional router vendors locked CSPs into expensive proprietary hardware upgrade cycles that could not keep pace with traffic growth.

White-box merchant silicon had matured enough to match proprietary ASIC performance at a fraction of the cost.

A unified software stack across all network functions eliminated the operational complexity of managing multiple vendor-specific OSes.

The founders' prior success in selling network software to incumbents gave them credibility and a playbook for enterprise-grade reliability.

Software-centric architecture on commodity hardware can disrupt capital-intensive industries by decoupling capacity scaling from cost scaling.

DriveNets subsequently secured Tier-1 operator deployments and raised additional funding, reaching unicorn status; its Network Cloud architecture became a reference model for telco cloud transformation and network disaggregation initiatives worldwide.