Oracle buys Ravello Systems for a reported $500 million

Larry EllisonOracleOracle executive chairman Larry Ellison

Israeli startup Ravello Systems confirmed on Monday that it has been acquired by Oracle.

Venture Beat reports that Oracle paid $500 million for Ravello, which would be a handsome price for the young company. Oracle declined comment on the price it paid for Ravello.

A few months ago, Business Insider named Ravello as one of the The 27 hottest Israeli startups of 2015. As of September, Ravello had 70 employees in Israel and the US, and “thousands of active users” and had raised $54 million in VC funding to date.

It plays in a very interesting cloud computing market. A lot of companies are using cloud computing for their “dev/test labs” which is how companies test new technologies and apps before they install them to make sure they won’t crash anything.

Ravello Systems had partnerships with Amazon, Google and VMware to make it easy for companies to set up these dev/test labs on their clouds.

Oracle is going after developers with a vengeance to bring them over to its up-and-coming cloud.

Ravello is joining the part of Oracle’s cloud business that hopes to take on Amazon, Microsoft, Google, IBM by letting corporate users rent computers, storage and networking.

Oracle is sort of late to the cloud wars. While it has been focusing on rolling out cloud versions of its popular business apps (finance, human resources, sales automation and the like) it has only recently got into a head-to-head battle with market leader Amazon.

In the meantime, Amazon has a huge head start, with a growing number of companies (including tech companies like Intuit, Netflix, Juniper), literally closing all of their data centres and using Amazon’s cloud instead. Oracle is a big loser in a scenario like that, since Oracle sells computer hardware for data centres as well as the software.

It needs its own cloud, and it needs to make it stand out from the competition, if it hopes to stop companies from going all-in on Amazon.

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