Business continuity, Mergers and Acquisitions, Midmarket, Mergers and Acquisitions, Storage

Carbonite Buys EVault Cloud Backup at Fire Sale Price

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Carbonite remains a buyer in the cloud backup and business continuity market, this time acquiring EVault from Seagate for the low, low price of $14 million.

On the one hand, Carbonite says EVault "is a leading provider of business continuity and disaster recovery solutions designed for SMBs and small enterprises." But on the other hand, the $14 million buy price suggests EVault never lived up to Seagate's lofty expectations.

Big Talk, Missed Opportunity?

Back in 2012 or so, Seagate positioned EVault as a cloud-savvy alternative to Symantec's classic Backup Exec market. At the time, EVault's executive team told me they were handling 15,000 data recoveries per month. Moreover, EVault at the time claimed to have 40 percent of the cloud backup and recovery market, based on the company's own estimates. "When it's the right time we'll IPO it," then EVault President Terry Cunningham told me in 2012.

Fast forward to the present day and it's clear something didn't go quite right with EVault. Cunningham exited the company in September 2014, and is now CEO of Springpath, a DevOps startup. And an EVault repositioning arrived in July 2015, according to ChannelBuzz CA.

Apparently, the repositioning didn't work out too well.

EVault's Value: Midmarket Data Protection

Still, Carbonite sees value in EVault's technology -- especially as Carbonite strives to extend beyond home offices and SMBs toward midsize customers.

Carbonite’s Mohamad Ali
Mohamad Ali

“With this acquisition, Carbonite is taking a big step forward in meeting the data protection and business continuity needs of the entire SMB market from home offices to medium-sized businesses,” said Mohamad Ali, President and CEO of Carbonite, in a prepared statement. “EVault’s proven technology, which includes a line of highly scalable appliances and advanced disaster recovery as a service (DRaaS) capabilities, enables us to round out our portfolio and immediately provide the features and functionality larger businesses require to support their complex environments.”

Carbonite essentially gains from Seagate:

  • EVault Cloud Backup and Recovery – a software-only solution for server backup
  • EVault Backup and Recovery Appliance – extends the cloud-based platform with an on-premises appliance form factor for local backup and restore
  • EVault Cloud Resiliency Services – a family of DRaaS services, which provide failover in the cloud

The deal arrives one week after Carbonite named Jessica Couto as its North America Channel Chief.

Cloud Storage Shakeout?

At only $14 million, Carbonite appears to be getting a great deal on cloud storage technology. But on the other hand, ChannelE2E has got to wonder if certain parts of the cloud storage market are set for a shakeout.

Among the other M&A deals that have reshaped the IT channel a bit over the past year...

ChannelE2E will offer more updates to this article as they unfold. And please note: We're not criticizing Carbonite for buying EVault on the cheap. On the contrary, "buy low, sell high" is a downright smart strategy. If Carbonite can succeed where Seagate failed, the EVault buyout will ultimately look very smart -- at least for the buyer and its partner base.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.