Veeam Valued at $15bn: Impact of the Data Resilience Boom

The data protection market has seen remarkable transformation in recent years, evolving from traditional backup solutions to comprehensive data resilience platforms that incorporate AI, ML and advanced threat detection capabilities.

Global concerns about cybersecurity and data protection are also at a high, particularly as organisations worldwide grapple with increasingly sophisticated ransomware threats and the complexities of managing hybrid cloud environments.

Considering these challenges and the growing importance of data protection and cyber resilience, Veeam Software, a global leader in backup and recovery solutions, has announced a major expansion of its shareholder base through a US$2bn secondary offering.

The transaction, which values the company at US$15bn, welcomes new strategic investors including TPG and Singapore's Temasek Holdings, marking a pivotal moment in Veeam's journey from its founding in 2006 to its current position as a dominant force in the enterprise software market.

The US$15bn valuation reflects Veeam's current market position but also investors' confidence in the growing significance of data protection as well as recovery solutions in an increasingly digital-first global economy.

Veeam has strong European roots and a significant presence in Switzerland, so this transaction represents more than just a financial milestone - but the company's readiness to potentially pursue an initial public offering (IPO) in the future.

Veeam's financial performance and market leadership

As of September 2024, Veeam’s strong financial performance reported US$1.7bn in annualised recurring revenue (ARR), reflecting an 18% year-over-year growth rate.

Its software-as-a-service (SaaS) subscription offerings have been particularly successful, achieving 31% growth over the same period.

This consistent profitability is further evidenced by Veeam’s EBITDA margins of 30%, surpassing the "Rule of 40" benchmark often used to assess the health of high-growth technology firms.

The company’s solutions are now trusted by 77% of Fortune 500 companies and over 550,000 organisations globally.

Part of this trust is due to Veeam’s comprehensive suite of services, including data backup, recovery, portability, security and intelligence.

These capabilities are delivered through flexible deployment models—whether as self-managed software or via cloud-based services such as the recently launched Veeam Data Cloud (VDC).

The VDC platform offers Backup-as-a-Service (BaaS) and features advanced ransomware protection alongside immutable storage options introduced earlier this year.

Anand Eswaran, CEO of Veeam, highlighted the growing importance of data resilience in today’s digital-first economy: “As enterprises embrace AI and digital initiatives, the volume and value of data continues to grow, along with the risks – ransomware, cyber threats and other outages.

“Our 550,000 customers and over 34,000 partners trust Veeam to keep their data resilient and their businesses running.”

Veeam's strategic implications of new investment

The US$2bn raised in this secondary offering will provide Veeam with greater flexibility to pursue strategic initiatives.

According to Anand, the funds will support research and development efforts as well as potential acquisitions aimed at enhancing the company’s capabilities in areas such as artificial intelligence (AI) and cloud computing.

While no specific merger or acquisition targets have been identified yet, Anand noted that opportunities will be explored in complementary technologies or markets where Veeam currently lacks a presence.

The transaction also reflects a strategic move to diversify Veeam’s investor base ahead of an eventual initial public offering (IPO).

Although no timeline has been set for going public, Eswaran emphasised that bringing on board "blue-chip" investors like TPG was critical for achieving future milestones such as an IPO.

TPG’s involvement is particularly notable given its experience in supporting technology companies through growth phases and public market transitions.

Arun Agarwal, Partner at TPG, remarked on Veeam’s readiness to capitalise on trends such as cloud migration: “As businesses transform digitally, a data protection strategy that evolves with them, no matter where their data resides, is more critical than ever.

“Veeam understands the trend toward migration to the cloud and is poised to gain share with their new cloud-first offerings.”

Insight Partners remains Veeam’s largest shareholder following this transaction.

Mike Triplett, Managing Director at Insight Partners, praised Veeam’s leadership team for building a trusted enterprise platform capable of serving some of the world’s largest organisations.

He expressed confidence in the company’s ability to sustain its momentum: “This success is a testament to both the strength of its management team and the world-class technology platform they have built.”

“In a digital-first world, data is the foundation of your business. If you lose access to that data, your business stops,” Anand highlights.

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