StorageCraft Gets $187M Investment, New CEO Plans To Make It A $500M Data Protection Powerhouse
Data protection software developer StorageCraft Technology on Wednesday said it has been acquired by a private equity firm that sees a massive growth opportunity for the channel-focused company over the near future.
TA Associates, a Boston-based private equity firm, has signed an agreement to invest $187 million in Draper, Nev.-based StorageCraft, a move that will make it StorageCraft’s largest shareholder.
Along with the investment, TA Associates is sending Matt Medeiros to StorageCraft to serve as the company’s new chairman and CEO. Medeiros, who has been with TA Associates for about six months, most recently served as president and CEO of SonicWall. Medeiros spent about 13 years at SonicWall, including three years following SonicWall’s 2012 acquisition by Dell.
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Medeiros will take over the reigns from co-founder and CEO Jeff Shreeve, who will retire. Russ Shreeve, co-founder and chief operating officer, will also retire. However, the company’s three other co-founders will remain with the company after the investment.
For TA Associates, the investment in StorageCraft was an opportunity to build a larger company on top of a solid foundation, Medeiros told CRN.
“We looked at the legacy of StorageCraft,” he said. “The company has been around a long time. It’d done a good job of running profitably, with double-digit [revenue] growth for the last five years. But getting a company from $100 million in revenue to $500 million needs a great deal of expertise. TA sees opportunity in StorageCraft’s technology portfolio and intellectual property.”
StorageCraft’s fastest-growing product segment is the cloud, Medeiros said. “Our offering is finely tuned for MSP and VAR partners,” he said. “We seen an opportunity to grow this business globally, and add new integration technologies.”
With the new $187 million investment in StorageCraft, Medeiros said he expects the company to continue developing data protection differentiated in what has become a very competitive market.
“StorageCraft’s core is backup and recovery,” he said. “Our differentiator is in the recovery portion. You can back up data all day long, but can you recover it? Can you get the data back in the format that you backed it up in? StorageCraft realized that not all data has the same value to different users. We want to make sure we understand the value of the data. Also, we want to make sure we offer data protection that is targeted at different market segments.”
A couple of StorageCraft’s channel partners said they look forward to increased investment in the vendor’s solutions and support. StorageCraft has a great MSP program, and has been very supportive of partners, said Steve Riat, sales manager at Nex-Tech, a Lenora, Kan.-based solution provider that both resells StorageCraft licenses and offers the technology as a service.
“StorageCraft has turned leads our way,” Riat told CRN. “The more leads we got, the tighter our relationship. About 80 percent of our StorageCraft sales are for a service.”
Nex-Tech has been building backup and disaster recovery, or BDR, appliances that combine the StorageCraft software with a hardware platform from Western Digital, but Riat said he would like to eventually see StorageCraft offer its own BDR appliances.
“BDR appliances are the future,” he said. “Well over half of the BDRs in the market use StorageCraft software at the core. I’m all for any plans for StorageCraft to develop its own appliances as it gets harder to have a separate hardware platform to support.”
Riat said he also hopes to see StorageCraft invest more in its cloud technology, particularly in developing a high-availability platform that provides a one-minute recovery to the on-premises infrastructure or the cloud.
“I also want to see a full offering from StorageCraft,” he said. “We now offer our customers file folder backups, on-site hardware connected to the cloud, and high availability with one-click or two-click recovery to the cloud. It would be nice to see an end-to-end offering with full hardware and software support from StorageCraft.”
Fred Moore, managing partner at Moore Computing, a St. Louis-based solution provider and StorageCraft channel partner, said he likes the vendor so much that every one of its customers uses its ShadowProtect solution.
Moore Computing resells the StorageCraft software and offers a StorageCraft BDR appliance-based service.
StorageCraft did have a couple of stumbles when it introduced its first cloud-based disaster recovery solution, Moore told CRN. “It wasn’t typical of StorageCraft’s execution,” he said. “But the issues are behind us, and the pricing is very aggressive. I didn’t lose any sleep over it. And there are tons of opportunities ahead of us.”
Moore said he is always a bit afraid when he hears that a private equity firm has invested in a vendor.
“Private equity can screw up a company,” he said. “It may be irrational fear on my part. But I hope they invest in StorageCraft’s products. Their off-site disaster recovery and storage solutions work well, and are economical.”