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Carbonite Buys EVault Cloud Backup at Fire Sale Price

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.

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.

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2 Comments

Comments

    Jim Lippie:

    Definitely a good buy for Carbonite! They get a very solid technology platform that is an instant upgrade to the technology they’re currently offering their SMB end-user customers through the channel. We have all seen this movie before, big company (Seagate) buys a solid asset (Evault), but it’s not very meaningful to their total business, so they don’t know how to leverage it. When the acquired company doesn’t make an immediate impact, the acquiring company turns its attention elsewhere for a line of business that will “move the needle”. Eventually the acquired company falls lower and lower on the priority list and they get spun out….usually for pennies on the dollar. This story doesn’t unfold in a galaxy far, far away, it happens all the time very close to home 🙂

    Great work Joe!

      Joe Panettieri:

      Hey Jim: I’m just happy the IT world continues to make moves that inspire me to shoot my mouth off 😉

      Kidding aside, I think the media (myself included) spends a bit too much time hyping expensive deals and not enough time looking at value buys that can be difference makers. This could be one of them. And even if it fails, $14M is a rounding error compared to most cloud storage ask prices these days…

      Thanks for always engaging with E2E, Jim.

      Best,
      -jp

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