When StorageCraft confirmed $187 million in private equity funding from TA Associates and a CEO change this morning, ChannelE2E pursued more details -- and we got them directly from new StorageCraft CEO Matt Medeiros and VP of Marketing and Business Development Curt James.
Medeiros, the former leader of Dell SonicWall, says he has three core priorities for the backup, storage and business continuity company. They are:
- Partner Support: "First, how do we take care of the partners we have today? That's the No. 1 priority." He says StorageCraft will shift heavily to more automated procedures -- including partner portal enhancements -- to ensure StorageCraft's partners are well-supported and scale with the company.
- Product & Service Diversity: "We'll double the number of products we introduce this year," he says. "The foundation of the company is our technology -- which is unique to our partners and customers." StorageCraft has adjacent technologies that will be transformed into revenue-generating products this year.
- Globalization: StorageCraft is already strong in the U.S. and Europe, with emerging beach heads across Australia and Asia. "But how do I expand from a great group of people inAustralia and moving deeper into Asia Pacific? And how do we expand in Europe to non-English-speaking countries?" The company's expansion journey will address those questions, he says.
Behind StorageCraft's Private Equity Funding, CEO Change
TA Associates' decision to invest $187 million in StorageCraft -- and Medeiros's decision to join the company -- didn't happen overnight. The journey began about six months ago, as both TA Associates and Medeiros explored the market for new investment and growth opportunities, Medeiros says.
Preliminary discussions about the journey led to a deeper dive look at StorageCraft. Things started to accelerate about three months ago, as it became clear that StorageCraft truly was a growth business with unique technology and upside opportunity in the channel. Similarly, Medeiros had the proven track record of building a global channel-led company -- having done so for SonicWall, and then continuing that success under Dell's ownership.
Under terms of the buyout, TA Associates is now majority owner of StorageCraft, and many of the executive leaders retain ownership in the company, Medeiros confirmed. Former CEO and co-founder Jeff Shreeve exits as part of the deal, James confirmed.
Why Medeiros Joined StorageCraft
So what attracted Medeiros to this opportunity? The answer involves technology and people. "First and foremost, the technology was absolutely paramount," he says. "It's part of the IT fabric you must have amid this data explosion." Innovation around data protection will keep StorageCraft from becoming commoditized, he said. "Second, through the due diligence, I found the StorageCraft team to be genuine in their caring for customer and partner success. For me, StorageCraft rose to the top of the list based on those factors."
On the other side of the table during the negotiations, James was impressed with the global know-how that Medeiros and TA Associates offer the company.
"From our perspective, when we started fielding discussions and looking at a potential financial arrangement, we didn't need the money," adds James. "We were profitable and essentially had no debt."
Still, the business was at an inflection point: Even as the company grew, it sounds like one or more co-founders wanted to take money off the table and diversify their assets. At the same time, other StorageCraft leaders wanted to double-down on the growth strategy. Aligning with TA Associates and hiring Medeiros as CEO allowed the company to achieve both goals.
StorageCraft Global Growth, And Acquisitions?
TA Associates, meanwhile, is an ideal partner to help StorageCraft drive global growth and perhaps even pursue some acquisitions, says Medeiros. The private equity firm has an $18 billion portfolio, and customers and companies within that ecosystem can certainly help to drive StorageCraft growth. Moreover, Jonathan W. Meeks, managing director of TA Associates and now a StorageCraft broad member, is a key influencer who can help drive StorageCraft's business forward.
StorageCraft already has a healthy start on the international front. The 300-person company has about 40 employees in Ireland, 35 in Australia and a growing footprint in Japan, notes James.
StorageCraft Partner and OEM Strategy
As Medeiros mentioned, partner support remains StorageCraft's top priority.
James echoed that statement. Leveraging the TA Associates dollars, "partner enablement will remain really big for us," says James. "Growing the managed services base and VAR base are key initiatives."
In terms of strategic relationships, OEMs and MSP software integrations will remain vital. "That strategy definitely continues forward," says Medeiros. "There are certain markets we'll never be able to reach, so OEMs are critical there. We need to understand the ecosystem players. Look at medical imaging products, for instance. How do we play in that market? Who are the best people and players in that market? In that example, an OEM most likely will help us get there faster."
Moreover, integrations with MSP software platforms like PSA (professional services automation), RMM (remote monitoring and management software) and BDR (backup and disaster recovery), among other examples, will remain key, James adds.
OEMs, meanwhile, are applauding StorageCraft's growth strategy. "We are thrilled for StorageCraft," says Ted Hulsy, VP of marketing at eFolder, a StorageCraft OEM. "It's extremely positive news for the company and the category as a whole. We've been one of their strongest partners and one of their largest OEM partners. We have a ton of joint partners who are passionate about ShadowProtect and using that with eFolder Cloud as a compelling solution."
Hulsy also pointed to Medeiros's proven track record building channel-friendly companies. "It's great for the StorageCraft franchise to have Matt at the helm," Hulsy -- himself a SonicWall veteran, added. "He's a guy who transformed SonicWall from a hardware company into a SaaS and services company. And SonicWall continued that great run under Dell's ownership."
Now, Medeiros hopes for an encore at StorageCraft.