Seattle-based Blue Box, which provides on-demand private cloud technology and was founded by Jesse Proudman when he was a freshman at the University of Puget Sound, was purchased by IBM.

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What: Seattle-based Blue Box, which provides on-demand private cloud technology.


Who: Jesse Proudman, founder and chief technology officer

The numbers: The company has about 65 employees and $22 million in venture funding.

Long time coming: Proudman started Blue Box 12 years ago when he was a freshman at the University of Puget Sound and bootstrapped for nine years. Now 30, he built the company from a managed-hosting enterprise to one that builds and operates hosted private clouds. Just last week, it was bought by IBM.

Blue Box, meet Big Blue: IBM has a clearly defined, elaborate cloud story made up of both a public and private cloud presence, and Blue Box will help define the private side, becoming the core tech team behind it, Proudman said. The private has two categories: The “dedicated” cloud is a hosted cloud, like what Blue Box has been selling since 2013. “Local” is an on-premises private cloud, where the server is at the customers site, but managed by Blue Box/IBM.

Status quo: For now, Blue Box is going to operate as it does now — with Proudman as the CTO and Matthew Schiltz as the CEO. Schiltz came in 2014. The transition plan to fold Blue Box into IBM will be happening over the next 30 to 90 days.

The dream: Proudman set out to build Blue Box as a company with a technology he was passionate about, not one to be acquired. But, he said, it is always something in the back of every entrepreneurs’ mind. “Everybody that starts a business thinks longterm about what the eventual outcome will be,” he said. “We want to see the tech we developed over the years reach scale. … IBM is the best partner to achieve that dream.”

After it closed a $14 million Series B funding round at the start of this year, Blue Box was approached by an undisclosed potential acquirer. That sparked interest from other companies, including IBM, Proudman said. Serious talks started in February at an IBM conference in Las Vegas.

The return: While the deal’s financial details were not disclosed, Proudman said: “It was a very healthy and exciting deal for our investors, and for our employees, and for me personally.”

IBM tech hub: Blue Box plans an aggressive hiring campaign, much of which will be focused in Seattle. Proudman says the eventual intent is for IBM to build a cloud engineering center in Seattle.

— Coral Garnick