Software startup CloudHealth sells to VMware for more than $500 million

VMware, which is buying CloudHealth Technologies, already had a deep connection to Boston.
VMware, which is buying CloudHealth Technologies, already had a deep connection to Boston.(Associated Press/File)

CloudHealth Technologies, a Boston software company that helps businesses manage their use of cloud-based data and services, is set to be acquired by VMware, a California company closely linked to Dell Technologies.

The companies did not disclose the terms of the acquisition, but a person with knowledge of the deal said the price was in excess of $500 million.

Founded in 2012, CloudHealth attracted about 3,000 business customers looking for help coordinating their use of various cloud services such as Amazon Web Services and Google Cloud. While moving functions off of hard drives and into remote networks made data easier to access from anywhere, it also raised security, performance, and cost issues that CloudHealth helped solve.


The company has about 240 employees in Boston, and said last year that it planned to have about 360 here — and 420 worldwide — by the end of 2018.

A company spokeswoman said expansion plans will continue, and it will retain its presence in Boston, where it recently opened a new office on Summer Street.

CloudHealth raised about $86 million from venture capitalists including Boston’s .406 Ventures and the big-name Silicon Valley firm Kleiner Perkins.

VMware, which offers its own set of cloud services, said in a statement that the acquisition would help it offer its customers “a consistent and actionable view into cost and resource management, security, and performance for applications across multiple clouds.”

The deal is expected to close in the coming months.

In a statement, CloudHealth founder Joe Kinsella thanked the company’s employees.

“I have been surrounded over the years by many great people, who to this day I call my ‘real investors,’” he said. “While they did not supply capital, they gave me something I value even more: their passion, their time, and their commitment.”

VMware already had a deep connection to Boston. Though it is publicly traded, Dell became the company’s majority owner after the computer company’s 2016 acquisition of its former owner, Hopkinton-based EMC.


Andy Rosen can be reached at Follow him on Twitter @andyrosen.