RALEIGH – Two well-known names in the Triangle’s tech ecosystem, Matt Berry and Rich Lee, are teaming up to launch Pureport, a startup based in Raleigh that aims to make cloud connectivity fast, simple, and scalable through a patented hybrid cloud software platform.

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Both men are returning to startups after selling previous ventures.

Berry cofounded Digitalsmiths, which was acquired by TiVo in 2014 for $135 million.

Lee purchased Hosted Solutions in 2001 and later sold the company to private equity firm ABRY for $144 million which later sold the company to Windstream in 2010 for $310 million with Lee still at the helm.

The two joined forces to acquire a three-person company just 60 days ago and decided to roll the company’s technology into a new venture based in Raleigh. But they aren’t strangers.

“We have a pretty long history of working together in our prior companies,” said Lee. Digitalsmiths was a client of Hosted Solutions prior to the Windstream acquisition. They’ve stayed in touch, particularly after Berry and cofounder Ben Weinberger sold Digitalsmiths, to discuss technology, innovation, and investments.

Both followed an interest in the rise of cloud computing and the technology that enables software defined networking, said Lee. “We’re really excited where we’re going to take this company.”

Berry knew quickly that the technology they sought to acquire would have broader implications and had the potential to change how enterprise companies access cloud computing power.

“We’re approaching this from an operational and technology perspective,” said Berry, “and we’ll round it out with a broader platform in order to take it to market.”

The technology

Cloud virtualization technologies are currently connecting people and businesses into cloud providers, said Berry. “But nobody is doing this for networks.” And yet, that’s where cloud computing is headed, he stressed, which is why he’s so excited about the prospects of software defined networking.

“We want to create toolsets in the forms of APIs that are going to power different forms of virtualization for the cloud,” said Berry. They plan to capitalize on the growth of cloud computing, but help enterprises by disrupting the current model of how they’re able to connect to the cloud.

Currently, enterprises rely on what is called a “direct connect,” Berry explained. This requires an organization to set up a contract with a provider and commit to a certain amount of data in a certain time frame at a certain price. These contracts can take a significant amount of time to set up, some as long as 90 days, and sets companies up to experience future growth-related challenges, said Berry.

It doesn’t make a lot of sense for companies to pay for circuits and access that are idle for as much as 90 percent of the time, said Berry, nor does it make sense for companies to sign long-term contracts that are inflexible and expensive.

The very concept of cloud computing—pay for what you use, with flexibility—is what Pureport hopes to achieve at enterprise scale, said Berry. “That’s the model we want to bring to the table.”

They’ll create virtualized circuits—hose direct connects—for their customers. “They can spin down and then when their load and capacity needs increase, they can relay that through us,” said Berry. “It saves a lot of money and creates a more flexible environment.”

Added Lee: “A lot of our end users, whether accessing on mobile phones, desktops, or through company routers, are having trouble getting to their cloud providers, but we’re making this all very seamless.”

Funded, and planning for expansion in 9,000 square feet

With a small set of customers already leveraging the beta version of the company’s technology platform, including one company that operates more than 80 websites, Berry and Lee are already planning their expansion.

“We’re anticipating a launch in the fall,” said Berry, and in the interim they plan to continue to partner with a few key accounts to refine their platform.

The company recently leased 9,000 square feet of office space in the Allscripts building, where Hosted Solutions was also based, and moved in with 10 employees on staff, including the three developers whose technology Berry and Lee acquired.

“We think we’ll be up to about 25 people by the end of the year,” said Berry, who noted that the company is currently in the hiring process for additional staff and has multiple job listings posted on their website. “There’s a lot of talent in Raleigh, but that makes it competitive at the same time.”

The company is self-funded, with Berry and Lee shouldering most of the investment. “The success we’ve had in the past puts us in a unique position,” said Berry.

“We do have a very connected group of investors that have already helped us make inroads with customers and potential partners,” Lee added. “Where we are today reminds me of what it was like when I opened Hosted Solutions.”

“This had to be a big opportunity to pull us out of retirement. It’s clearly an advantage for us to start a business in our own backyard.”