Billion Dollar Unicorns: Veeam Wants To Stay Private

According to a report by Gartner, the enterprise backup recovery software market was worth $4.7 billion in 2013. BAAR, Switzerland-based Veeam is a Billion Dollar Unicorn club member in the enterprise backup, recovery and data de-duplication segment which is making big waves in the industry.

Veeam’s Offerings

Veeam was founded in 2006 by Ratmir Timashev and Andrei Baronov. Ratmir had discovered his entrepreneurial drive early on in his career. After leaving school, Ratmir started and sold several businesses with his partner Andrei Baronov. In 2005, the two took their time to search for their next big idea. After realizing that the next big trend was virtualization, they decided to create different tools that VM administrators would need to do their day-to-day jobs. Virtualization was a big market trend at the time considering that back in 2006, within the US alone, 69% companies were implementing virtualization technologies. Soon, the two started to create tools that helped with activities like monitoring, administration, and management. They finally released a back-up tool, their most successful till date, in 2008.

Veeam’s vision has been to help organizations meet the challenge of operating in an Always-On Business mode. Their products such as the Modern Data Center helps organizations meet recovery time and point objectives of less than 15 minutes for all applications and data. Veeam Availability Suite includes their core Backup & Replication software leveraging virtualization, storage, and cloud technologies to enable organizations with the ability to manage data while saving time, mitigating risks, and better managing costs.

Veeam’s Financials

Veeam’s impressive product portfolio has helped them deliver strong financial growth. They earn revenues through license fees and service contracts. The company does not disclose detailed financials, but recently they announced that they had crossed over $1 billion in bookings since they released their first product in 2007. During the last fiscal year, they saw new license bookings grow 33% over the year to $288 million. Renewal bookings increased 66% to $101 million. Veeam ended the year with over 135,000 paying customers. They are also increasing their focus on the cloud offering. The Veeam Cloud Provider Program reported rental and subscription bookings growth of 106% over the year with more than 6,800 service and cloud providers as part of their worldwide program. The company has been profitable since 2009 and is targeting to reach $1 billion in revenues by 2018. They forecast 2015 bookings at around $500 million.

Veeam has not received any venture funding to come this far. They have been funded by their founders who invested $5 million of their own money to set Veeam up. In 2013, Veeam partnered with Insight Venture Partners, allowing them to become a minority shareholder with them. Through the partnership, Veeam hopes to achieve strategic guidance from Insight Venture Partners. Veeam plans to stay independent and does not want to list on the stock exchanges in the near future. Veeam’s valuation is not known, but given their financials, they are clearly above the billion dollar number. Insight Venture Partners, surprisingly, has accepted to take dividends as their return on investment, and is not pressing for an exit – a highly unusual stance from a venture fund.

Last week, Ratmir Timashev joined me at a 1M/1M roundtable. You can listen to the recording here.

More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.

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I receive many emails from entrepreneurs who want to discuss their specific businesses. I’m very happy to discuss your situation during my free online 1M/1M Roundtables, held almost every Thursday. During each roundtable, up to five entrepreneurs can pitch their businesses and receive my immediate and straightforward feedback.

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