Four-year-old firm says market is not mature enough.
Nebula, a hardware company that helped firms to deploy private clouds, announced it was shutting its doors on Wednesday.
Built on the cloud framework OpenStack, the firm attracted widespread interest when it launched in 2011, raising funding from Google’s executive chairman Eric Schmidt, among others.
In a message posted on its website, Nebula said: "We are incredibly proud of the role we had in establishing Nebula as the leading enterprise cloud computing platform.
"At the same time, we are deeply disappointed that the market will likely take another several years to mature. As a venture backed start up, we did not have the resources to wait."
It added that Nebula private clouds would continue to work, but the firm would cease to provide support for the products.
However since the product is built on OpenStack it is compatible with products from other vendors, including Red Hat, IBM and HP.
Since its creation the firm raised almost $40m from venture capital firms, and had the backing of many influential people in Silicon Valley.
"We want to thank the incredible Nebula team that has worked so hard over the past four years," Nebula said.
"This is a difficult announcement for us to make and we want to assure our customers, shareholders, and employees that we have worked hard to explore alternatives and exhausted all potential options."