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Cloud firm CloudShare expects to triple sales next year

CloudShare has said it expects sales to triple next year as the cloud computing market rapidly expands.

"I think next year we will be two to three times larger than this year in terms of sales," CEO Guri Stark said of CloudShare, which develops technology enabling web-based development and testing of software applications.

While he would not disclose sales and profit figures, Stark said he expects the company to be profitable soon.

Its top seven or eight customers, including SAP, Adobe, HP, Dell and Cisco, pay $400,000 to $800,000 a year to CloudShare.

Earlier this month SAP announced the $3.4 billion purchase of web-based software company SuccessFactors as it tries to catch up to rivals in cloud computing.

Stark said acquisitions in the cloud sector are happening almost weekly, which showed "how important the cloud has become".

Stark said SAP's acquisition reflects its desire to compete with larger rival Oracle and pioneer Salesforce.com in the software as a service market, where business applications are hosted on the cloud, or Web.

Web-based software is popular because companies can vet the products before buying, pay by the month, and do not need to buy expensive hardware.

CloudShare does not compete in this market as it does not host applications.

"SAP has been a large and growing user for us and we expect this to accelerate," Stark said.

Initially focusing on cloud-based sales enablement such as training, CloudShare has expanded to target development and testing of applications on the cloud, or what Stark calls preproduction.

"This is to differentiate from production, which is what most hosters such as Amazon do today," he said.

"There you have an application ready and running in the cloud and customers use it instead of on premise."

He noted that major companies have focused on hosting and underestimated the size and importance of preproduction, where he said "everything is changing all the time".

CloudShare said its technology makes it easy to create and change complex environments in the cloud.

Founded in 2007 by Israelis who served in an elite army intelligence unit, CloudShare moved its headquarters to California while maintaining development in Israel.

The company raised $26 million from Sequoia Capital, Charles River Ventures, Gemini Israel Funds and Globespan Capital Partners.

While it is not looking to go public or be acquired now, CloudShare is seeking partners to sell combined solutions.

"We have one on a large scale that we will announce in January with a U.S. software development company," Stark said.

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