NEW ORLEANS – At the opening keynote kicking off Partner Day at the VeeamON event here, Peter McKay, the company’s co-CEO and President, both reiterated Veeam’s commitment to their partners and their 100 per cent channel strategy. He also outlined some subtle modifications to their channel strategy to seize share from competitors in a highly volatile availability market.
“There’s so much disruption now,” McKay said. “For the companies that are agile, it’s the best of times. But for those who don’t change and don’t adapt, it’s the worst of times.”
While Veeam is privately held, McKay shared some recent financial information showing the company’s strength and momentum.
“We had $607 million in 2016 bookings – a fantastic year, where we did far better than we thought we would,” he said. “We had 28 per cent growth year-over-year.” That’s commensurate with Veeam’s growth curve over the last eight years, where the average has been 36 per cent. They ended the year with 231,000 customers, and are adding 4,000 per month.
McKay also stressed that Veeam is investing aggressively in sales and marketing, with $126 million in marketing spend constituting 20 per cent of their revenues. He also emphasized that they have added 1000 employees in the last 12 months, and are looking to add another 800 over the next 12. Last, and not least, he emphasized that Veeam has an 87 per cent customer renewal rate, and a Net Promoter Score of 73, more than double the industry average.
McKay emphasized that notwithstanding Veeam’s market share lead in the space, it is committed to disrupting itself to realize this agility.
“We need to act more and more like a startup,” he said. “We are choosing to change when things are going well. We need to change and adapt as we grow, and that’s important for all of you, who have invested some portion of your business in Veeam.”
McKay cited Gartner’s assessment that half of the six million dollar availability market is available to be displaced as providing an enormous opportunity to expand their Total Addressable Market.
“We have a window of opportunity to grab that three million opportunity in that displacement market,” he said. He noted that many of their key competitors had been recently losing share, including Commvault, down 4.1 in market share growth year-over-year, Veritas down 3.6 per cent, and Dell EMC, down 5.7 per cent.
“At some point that will change, so we need to make hay while the sun shines,” McKay told partners.
Veeam has upped its growth targets, McKay said. They now stand at a billion in revenue for 2018, up from that 607 million in 2016 – and 1.5 billion in 2020.
“The strategy to get there revolves around four key principles,” he said. “Focus — on the right customers in right markets. Understanding – getting information and feedback. Transforming how we do business, and the need to change ahead of the market.
“We believe there is a lot of disruption we can achieve,” McKay continued. “As well as leveraging our partners, we will leverage our alliance partners better than we have – Microsoft, VMware, HPE, Cisco, Nutanix, NetApp, Pure and others.” Leveraging their go-to-market system to better involve alliance partners is one of Veeam’s 2017 priorities.
Another top priority is improving internal processes, which they are implementing both on a strategic and at a tactical level. Veeam’s strategic market segmentation has been based on dividing the market between small (under 10k) and large accounts. That’s not typically how others, including Veeam partners, do it, so things have changed for 2017, starting in the U.S., and expanding globally. Veeam has now hived its top 1100 accounts into an Enterprise segment, while retaining focused commercial and SMB segments. Since Veeam sells entirely through partners, no hard deck is involved. They do think that it will improve selling focus, however, particularly in those larger accounts.
“We are also looking at areas to make our business scale better and faster – such as improving the way we proceed from a net-new lead to a qualified lead, and how it’s routed through partners,” McKay said.
“The opportunity in front of us is so significant,” McKay said. “We need to think bigger and think bolder, and expect more of each other in the market. We’ve pushed everybody internally to raise the bar. We have to be bold. We have to be aggressive. The ask is, as we push the Veeam Team, that we also push the ecosystem to raise the bar. We need to do better to continue the success we have had.”