Data Protection market
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As in any other investment, Private Equity also needs diversification. When a venture fund creates a portfolio it tries to capture as many industries as possible in order to lower the risks. For example, if you choose to invest solely in fintech, there is a high risk of international regulation and companies from your portfolio might be affected. In order to distribute risk, it is wise to invest in companies from whole different markets.
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Data protection
A new generation of cybersecurity startups is scaling up to serve companies in the remote-work era as a fresh wave of sophisticated attacks spreads security fears. An example of a recent Colonial Pipeline attack has increased concerns on cybersecurity issues.
Venture capital is flowing into cybersecurity companies at an unbelievable pace. Since the beginning of 2021, cybersecurity startups have raised $9.9 billion globally, 96% of the total raised in 2020, according to PitchBook data. Meanwhile, the average valuation of the companies raising funds has more than doubled, to $475 million. Raison app is listing one of the most promising companies in the field.
Rubrik
Rubrik, Inc. is a cloud platform for protecting big data. The technology provides instant disaster recovery, lowers operating costs, and protects data from ransomware to the on-premises cloud. The company was founded in 2014 in Palo Alto, California.
More than 200 customers spend $1+ million per year on Rubrik’s flagship products. Among others, there are 8 companies from Fortune 100 list in the telecommunications, insurance and aerospace industries. In total Rubrik, Inc. serves more than 3200 clients, among which you can also find Verizon, Mazda, Cisco, Adobe, Expedia and Toyota Research Institute
This year the company was included in the top 10 companies in Forbes Cloud 100 list. Among other successes, the company has won numerous awards in the data security industry. Gartner Peer Insights nominated Rubrik “Best in Backup and Recovery Solutions” in 2020 and 2021.
Moreover, Rubrik, Inc. has won a $10 million tender to build a mission-critical data transit for a secret agency under the US government. That was mostly because the Rubrik, Inc. platform is highly efficient and secure. Ont of the clients — CIS Companies received $13 million in potential savings and 32 days of additional productivity time.
The company is constantly expanding its range of cloud services through partnerships and acquisitions. The recent expansion of its partnership with NetApp is set to increase sales of its products. In December 2020, Rubrik, Inc. acquired Igneous, a developer of an unstructured data backup platform. In February 2020, Rubrik, Inc. acquired Opas AI, an AI technology that recognizes application behavioral patterns to provide its customers with more proactive responses and shorter problem-solving cycles.
Market Overview
According to VMR research, the global data protection market was valued at $198.5 billion in 2020. The main players in the market are IBM, McAfee, Dell Inc., NetApp, Oracle and others. The list of the market includes many verticals: data recovery, archiving, data cryptography, protection against viruses, etc.
Rubrik also operates in the Data protection SaaS market, which is forecasted to expand at a CAGR of 31.3%.
Rubrik, Inc. additionally operates in a narrower backup and recovery market that Report Linker predicts is going to expand to $15.2 billion by 2027. Amid the COVID-19 crisis, the global market was estimated at $8.4 billion in 2020.
Financial Performance
- The company is ending fiscal 2020 with $600 million in revenues, driven by strong dynamics in the corporate market.
- About half of the revenue comes from customers who spend $1 million or more on Rubrik, Inc. services.
- In 2017, the company had revenues of $100 million, in 2018 — $ 300 million.
- The company’s revenue growth was stimulated by the transition to the subscription business model. Rubrik, Inc. managed to switch almost 70% of its customers to an annual subscription by early 2021.
The capital raised in the last round was aimed at expanding geography and launching new products (such as Rubrik, Inc. Go — subscription service).
Risks
Reputational risk in this industry is relatively high. With intense competition in the industry and a low number of customers, major errors or data leaks can negatively impact a company’s customer base.
Moreover, competition from tech corporations may negatively affect the company’s revenue growth. As well, regulation on the storage, transmission and processing of data can increase the pressure on the margins of the company, as well as the industry.
Founder and Management
The founder of the company, Bipul Sheena, worked as a software engineer at IBM before founding Rubrik, Inc.. Thereafter, he was a director in charge of several products at Oracle related to databases and middleware.
Dan Rogers was named the first president of the company following his leadership as Director of Marketing at ServiceNow and Symantec and previous leadership positions at Salesforce and AWS. Kiran Choudari was named CFO after leading Atlassian’s successful IPO.
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