Moka5 has apparently shutdown and ceased operations. Here's what we know.

It appears that last Friday Moka5 laid off a majority (or perhaps all?) of their employees and they have since ceased operations.

(Despite posting this on April 1st, this is not an April Fool's joke.)

It appears that last Friday Moka5 laid off a majority (or perhaps all?) of their employees and they have since ceased operations. [UPDATE April 3: They kept a skeleton crew. Details here.]

This information is based on emails from two employees who were employed at Moka5 up through Friday. They both said they were let go along with most of the employees in the company, and that they didn’t have any more information. When asked what was going on with the company, one said they didn’t know and the other said they were told that a third party would be running the company now. 

Obviously this is a pretty big deal, so I wanted to try to get an “official” statement from the company before I wrote about it. Unfortunately I failed. I spent Monday and yesterday trying to find out more information. I emailed 8 or 9 people I knew from the company via their Moka5 email addresses but haven’t heard back. I heard back from one person via their personal email and also confirmed that they’re no longer there as of Friday and they don’t know what’s going on.

I also emailed my external PR contacts who handled Moka5 (which I heard from as recently as a few weeks ago), but I haven’t heard back from them either.

Clicking on the “Our Team” link on moka5.com today lists three VCs:

Moka5 after

 

The Internet Archive link to that page from March 13 shows actual people in the "About Us" section as well as a "Test Drive" (for evaluation software downloads) link that is no longer on the current site.

Moka5 before

 

Finally, since I still couldn’t confirm anything, I posted a hail mary tweet:

Brian Moka5 tweet

Two retweets. No replies.

So at this point I’m going to say it looks like Moka5 is no more.

Good tech. Tough business.

We’ve written 26 articles about Moka5 (and mentioned them in countless others) since we first mentioned them as part of our VMworld 2008 roundup. Back then their business was around managing Type 2 desktop VMs on Windows and Mac clients. They had delta disk image replication, encryption, remote wipe, and other features that provided many of the management benefits of VDI without the downsides of desktop remoting.

If you take a look back at their history, you can start to see the problem. Moka5 tried lots of different strategies but none of them really got good traction.

The core client VM management was slick. I wrote adoringly about it again and again. Unfortunately it would never become “the” client management solution for a company. Moka5 was almost always used alongside an existing Citrix or VMware desktop virtualization deployment. It was always a tough sell for customers to say, “Wait, so we already use Citrix. So are you instead of them? Or in addition? Or..”

The other problem is that even though it took some time, both Citrix and VMware have since released or announced products similar to Moka5. Citrix now has the Citrix Desktop Player, and VMware has Flex. Even though neither of these are as good as what Moka5 had, they scratch the itch customers might have, and since these are all used for a small subset of users anyway, customers are happier just to use what they have.

And, plus, how much has Type 2 client hypervisor management caught on? If it was really a big deal then Citrix or VMware would have done it years ago. And what other examples of it all there? Microsoft / Kidaro / MDOP? How’d that turn out?

The other problem they had was funding. CrunchBase shows that Moka5 raised $104m in eight (!) rounds. The problem with raising that much cash is that puts a selling price for them in the $200-300m range which is a figure you only get if (1) your tech is so “change the world amazing” that a buyer wants it and will do huge things with it, or (2) you have $100m in revenue with potential for growth. Unfortunately Moka5 had neither.

Now what?

Moka5 has been in fire sale mode recently according to a few sources at larger companies who Moka5 approached. Unfortunately those conversations didn’t go anywhere and it appears the company essentially just ran out of money.

Assuming they are actually shut down, the next step is that the investors will try to sell the IP to whomever will buy it. There’s certainly a lot of good technology there, and it could be a good asset pickup for someone. The question is who? Maybe a Citrix or VMware buys them for a few million bucks? Maybe someone else in the management space? It’s hard to see a buyer taking the product back to market, rather, there could be some IP or patents (Moka5 has 20 granted and 15 more applied for) that are interesting to someone?

The bigger question for most of us is about Moka5’s customers.

What about customers?

This current Moka5 situation feels a lot like Pano Logic’s 2012 shutdown which they managed to keep secret from everyone, including customers. (Seriously, even the fact that the website remained up and unchanged with the exception of the removal of the names of the management team.)

If Moka5 has truly shut down, customers are going to be kind of stuck. Even if Moka5’s investors manage to sell the company’s IP to someone, it will probably be done as an asset deal where just the IP is sold at the existing support contracts and customers are left with a empty bankrupt husk of a company with no employees and no IP.

Even for bigger customers with source code in escrow—what exactly are they supposed to do with that? “Hey Bob. You’re the Moka5 admin here, right? Well here’s their source code, can you fix that bug we put in the support ticket for last week?"

The takeaway

There’s a finite amount of time a company can exist in a state like Moka5. In the EUC space, a new company basically has two options. (1) They get bought in the early, early stage before they have many customers because some big company really loves their technology and thinks it’s going to be a huge game changer, or (2) they need to go for a few years and get lots of customers and lots of revenue that some big company can grow even faster than what they could do on their own. After it was clear that Moka5 wouldn’t be the first type of company, they had to get the customers, the revenue, and the growth, which they just couldn’t do.

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This is all a shame...as Brian said, "Good tech. Tough business"


I wonder what will happen to the assets? There is the client hypervisor, the layering, the mobility, and the customers. I can't imagine any of those things having any value to Citrix or VMware. Frankly, you can bet that M5 has been shopping themselves around for a while to save this from happening. I'm sure Citrix and VMware have already had their chance.


A few companies come to mind. The first is Dell, which at one point had a product that leverages a partnership that Quest Software made with Moka5 years ago. That may or may not still be in effect.


The other thought that comes to mind is ThinSpace, which was formerly called ProPalms. ProPalms is the company that bought the Windows version of Secure Global Desktop after Sun sold it off (remember that lineage? New Moon > Tarantella > Sun > ProPalms). After Pano Logic shut down, ProPalms acquired the assets and customers and continued support under the new name skyPoint. They've renamed themselves to ThinSpace, so they are still making investments into their product offering.


So if I'm taking bets, I'd say ThinSpace tops the list of potential suitors. But man...it's a shame to see it end this way.


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Ah, c'mon. April Fools, right?


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Always leery of a BM post on April 1st.


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If only that were the case. Like Gabe said, this is a shame. I liked their technology, and I was a big fan of where they were going with Project Skynet. Best of luck to everybody at Moka5.


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Oh geez...Unfortunately we didn't consider today is April 1 when this was posted last night. This is legitimate, and it isn't the kind of thing we would joke about anyway.

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I saw a few more people on twitter have tweeted to them asking for any kind of confirmation. Both their facebook and twitter feeds haven't had any activity since last week.


I just tried calling the main number listed on mokafive.com. I tried a few different times with different options but they all just go to voicemail. So I have yet to be able to talk to an actual human being who works there.


So weird...


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I noticed on Twitter the other day that after 7 years as CTO John Whaley decided to leave Moka5. Clearly for very justified personal reasons but I wondered what the impact on the company might be... He was always the driving force.


Good luck to him with his future endeavours (deserves it).


I'm not sure what the up take was with vWorkspace customers? - It was an expensive solution for a small company compared the competition.


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Yeah I'm looking forward to what John does next. He left on the same day that everyone else was let go, so I don't think Moka5's disappearance was related to him leaving. In fact he might have left *because* of the company vanishing.


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UPDATE: I just heard from Moka5's current VP of Finance. They have a skeleton crew in place of devs and support staff as they look for a buyer. I'll get more info and write a follow up article for tomorrow.


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