Billion Dollar Unicorns: Druva Poised to Produce an Indian Unicorn

Not many successful technology product companies have emerged from India. Data protection solutions provider Druva is one of the first of its kind. Druva still has some way to go before it joins the Billion Dollar Unicorn club. But given its performance thus far, it certainly shows promise.

Druva’s Offerings

Druva was founded in 2008 by Milind Borate, Jaspreet Singh, and Ramani Kothandaraman. Before setting up Druva, both Milind and Jaspreet had worked at the storage foundation group at Veritas. Both of them were infected by the startup bug, and Milind left Veritas to set one up. Jaspreet joined him soon after. For a while though, the two worked on catering to the disaster recovery market. They wanted to innovate within the compliance, risk mitigation, and disaster recovery of mission-critical data space. They built a product geared toward this, but realized that it was not so easy to sell. While trying to sell their product, Jaspreet realized that another market opportunity lay in the area of risk mitigation for endpoints. They focused their efforts on creating an endpoint backup product and created the first version of Druva. The team began building the endpoint product in 2008 and released it in 2009.

The importance of endpoint backup was increasing as more and more employees were migrating to mobile devices. Organizations needed to not only protect on-premise data, but also when their employees were traveling. Products available back then were focused on anti-virus and leakage protection and hardly any one focused on endpoint backup. According to Gartner, the market was estimated to be worth $650 million back in 2013 and projected to grow 10% annually.

Today, Druva is the market leader in converged data protection. They offer an easy-to-use, single dashboard that lets organizations manage backup, availability, and governance. They are among one of the fastest growing data protection providers and have seen their product installed in more than 3 million devices across 3,000 organizations worldwide. Their customers include names like Dell, Hitachi, and Pfizer.

Their core products include the endpoint backup platform InSync and remote server backup Phoenix. InSync uses a single dashboard for backup, availability, and governance of endpoint data. Organizations are able to ensure mobile data backup, data loss prevention, and data governance along with file sharing and access capabilities. The remote server backup product Phoenix is a cloud-based backup service that lets organizations store data indefinitely with limitless snapshots and flexible retention policies, while ensuring lower backup costs.

Druva’s Financials

Druva charges a per-user-per-month fee for their InSync product. Prices are determined based on the features that the organization chooses. The basic option for smaller businesses is available at $6 per user per month and comes with complete endpoint backup and mobile suite capabilities along with provisions for regional storage provisioning and Microsoft active directory integration abilities. For larger organizations, prices start from $8 per user per month and feature additional capabilities such as delegated administration, integrated mass deployment, and single sign-on. Phoenix’s capabilities are sold on a usage-based pricing.

Druva does not disclose detailed financials, but at the recent 1M/1M Roundtable, Jaspreet mentioned that the company was operating at revenues between $10 million and $50 million. Earlier, at our Oct 9 roundtable, Naren Gupta of Nexus Venture Partners mentioned that they’re doing $10 million a quarter. So, if we extrapolate from these two conversations, our estimate is that Druva’s current revenue is in the $12 million-$15 million per quarter ballpark, and they will probably finish 2015 at close to $50 million annual revenue. That puts their valuation at a minimum of $500 million, and given the current market frothiness, if they raised money today, they’d probably be able to get a valuation pretty close to a billion. The real question, of course, is would that valuation sustain in the public market? Druva would do well to ensure that they execute steadily, and with close attention to the fundamentals. It’s a very promising company with solid fundamentals that do not deserve mucking up.

Druva was bootstrapped initially, and after proving their product and capabilities, they were backed by venture firms. They have raised $67 million so far with investments from Tenaya Capital, Nexus Venture Partners, Sequoia Capital, EMC Ventures, and Indian Angel Network. Their last round of funding was held in August 2014 when they raised $25 million at a valuation of INR 14 billion (~$220 million).

Last week, Jaspreet joined me at our 1M/1M Roundtable. In case you missed it, you can listen to him here.

More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. Unicorns will also be discussed with some special guests during our 1M/1M Roundtable programs over the next few weeks. To be a part of the conversation, please register here. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.

This segment is a part in the series : Billion Dollar Unicorns