DPU startup Fungible hires CEO to vault revenues higher and higher

After six years, co-founder and Exec Chairman of DPU startup Fungible has replaced himself as CEO with Eric Hayes – a man who grew Broadcom’s switching silicon business from $100 million to more than a billion dollars a year. A tenfold revenue jump? Yes please, that will do nicely.

Pradeep Sindhu co-founded Fungible in 2015 with former Apple SVP Bertrand Serlet, with the aim of developing a new processor with an architecture and instruction set specifically designed to execute information packets involved in data communications between data centre infrastructure elements – such as servers, network switches and storage arrays. Offloading this growing burden from hyperscale and near-hyperscale data centres would free up tremendous amounts of server CPU resources to run application code – the entire point of having a data centre in the first place.

Eric Hayes.

A quote from Hayes said: “While many other companies continue to invest in faster CPUs and GPUs, the real bottleneck to achieving performance at scale remains the inability to efficiently disaggregate CPUs, GPUs and storage over a high-performance standards-based network. The market is ripe for disruption, and Fungible’s DPU is the only technology capable of solving this problem.”

A Sindhu statement said: “It has been a great privilege for me to lead this extraordinarily talented group of dedicated individuals to invent the DPU and bring to market industry leading products that exploit its unique capabilities. The DPU is a new category of microprocessor destined to become a key building block of data centres as the industry embraces data-centric computing.”

He becomes Fungible’s Chief Development Officer, about which he said: “My new role allows me to focus on technology – taking the learnings from our first generation of DPUs and applying them to the next, and further enhancing our already industry-leading products.”

Fungible’s first products, its FS1600 storage node, DPU chips and composable data centre software, have received, Sindhu says, “significant validation from key customers”. Hayes has been hired “to further accelerate this momentum”.

Hayes’s LinkedIn CV shows, in reverse order: two years as SVP Networking Interconnect at Inphi, five years at Marvell finishing as SVP/GM networking, and more than 13 years at Broadcom, ending up as VP Platform Marketing. Fungible is his first CEO-level gig, but Sindhu is confident: “we will achieve the ambitious goals we have set for ourselves.”

As Exec Chairman Sindhu will still be on hand to help and guide where needed.


We note Fungible has raised a total of $310.9 million, with the last round being a $200 million C-round in 2019. Since then it has launched its first hardware products using its first-generation chip, and bought Cloudistics for DPU-related software composability technology. A sales boss, Brian McCloskey, was appointed in February this year. Cash is being burned.

Blocks & Files view is that Fungible will keep spending on development for its second-generation chip and on its software. But it will also keep investing in sales and marketing and support, and build out its general business infrastructure. If Hayes hits the street running and Fungible’s revenues grow nicely, then we expect a fourth funding round next year. We think it could a $200 million-plus round, and value Fungible as a unicorn ($1 billion-plus) – if things go well. 

That means it notches up tier-1 and/or -2 cloud provider/hyperscaler data centre wins, and these customers make big app server/GPU server efficiency gains.

Let’s finish up with a final Sindhu quote: “Every significant advancement in technology is enabled by a step-function improvement in one of its fundamental building blocks. The Fungible Data Processing Unit … represents just such a step-function improvement in next-generation data centres.”

It’s a step function, but will customers be persuaded to make that step up? Hayes and his new team have to make sure they do.