IBM Corporation acquired Israeli data storage company Storwize for $140 million at the end of July, in a sale that reflects an average three-fold return on investment.

Almost $40 million was invested in Storwize, mostly by private investors, but also by strategic investors, including Sequoia Capital, Bessemer Venture Partners and Tanaya Capital (formerly Lehman Brothers’ venture capital arm).

Storwize uses complex algorithms to compress data in real-time, even before it is sent to storage systems. Storwize president Gal Naor and CTO Jonathan Amit founded the company in 2004.

Originally based in the Tel Aviv suburb of Yehud, in early 2008 Naor and Amit moved the firm to the US, the company’s primary market, to meet their growth plans and it is now headquartered in Massachusetts.

Israel’s leading financial daily Globes, reports that the company held a number of financing rounds over the years. Its private investors include Igal Ahouvi, Pujo Zabludowicz and former Bank Hapoalim chairman Shlomo Nehama. Japanese computer infrastructure giant Tokyo Electron Device is a strategic investor.