April 25, 2013 – Platform as a Service startup Pivotal has eclipsed the $1 billion funding mark after General Electric announced a strategic investment and commercial deal with the four-month-old startup.

GE pledged $105 million to Pivotal, the analytic platform service offshoot that’s a concerted PaaS development effort by vendors EMC and VMware. GE said its investment represents a 10-percent stake in Pivotal, and that the deal also entails broader commercial R&D and use of Pivotal’s framework as the “source for delivering data analytics and cloud architecture” from its huge software development center in San Ramon, Calif.

Pivotal was spun off from EMC and VMware at the end of 2012, with hundreds of employees from each, including CEO and former VMware head Paul Maritz. The first commercial release of its Pivotal One PaaS offering is anticipated in the fourth quarter of 2013.

Bill Ruh, VP and corporate officer for GE’s Global Software Center, said in a statement on the investment in Pivotal: “It's no secret that the cloud and big data are driving dramatic business transformation enabling an ‘Industrial Internet’. At the heart of it is that machines can be intelligent, connected, and that we can use software to analyze the information coming out of them. To support this next frontier requires an architectural shift in how our services are built and delivered.”

GE opened the San Ramon global software headquarters at the end of 2011 as part of a wider $1 billion development of data capabilities and analytic services to capture a “new generation of intelligent systems that can predict and respond to changes.”

PaaS spending is expected to double 2012 rates in four years’ time, reaching $2.9 billion in 2016, according to a Gartner Research forecast.

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