Druva Inc: A look into India’s magical Unicorn Startup

What is it that comes to your mind when you hear the term 'unicorn'? Is it the mythological, fantasy horse with one horn on its forehead and wings attached to its torso? However, for those active in the finance and business world, this term is a depiction of not a magical creature, but a magical startup.

Originally coined by venture-capitalist Aileen Lee in 2013, the 'unicorn' in the financial world, refers to a startup company that is privately-owned and has a valuation exceeding $1 billion.

Since the birth of this term, startup unicorns have grown at a much higher rate globally, than it was ever expected. Some popular and successful examples of global unicorns include Airbnb, Uber, SpaceX, Robinhood, and SoFi.

India is not behind in the unicorn industry either. With new startups emerging every year, the Indian unicorns have grown immensely in the past couple of years.

In this blog series, we will explore a few of India's most successful startup unicorns that have transformed the Indian startup sector.

One such example is Druva Inc, which is one of the Indian-origin startups that turned into unicorns in the year 2019. In June 2019, this Indian origin company which is headquartered in the U.S., transformed into a unicorn after it received a funding of $130 million. This made Druva India's first legitimate SaaS product Unicorn.

Druva Inc: How did it start?

The company was founded in 2008 by Milind Borate, Jaspreet Singh and Ramani Kothandaraman. The business aims to provide data solutions and data protection to different enterprises. Druva Inc was initially established in Pune, but after getting sufficient traction, the company shifted its base to Silicon Valley in order to transform into a global products company. 

Initially, the founders wanted to start off with something that was related to risk compliance and risk mitigation. However, towards the end of 2009, they turned towards a product that was related more to endpoint backup as they realised its importance as everyone was moving towards mobile devices. 

During that time products for data protection and security were mainly around anti-virus and data leakages, nothing much was done in the field of endpoint backup. That's when Druva stepped in. 

The company has evolved to become one of the fastest-growing data protection providers. They provide a product that is simple to use and has a single dashboard that lets enterprises manage their backup, governance and availability. 

Companies like Fujitsu, Lockheed Martin, Dell, Hitachi, Marriott, etc. also use the products offered by Druva. It has also expanded and opened up offices in Australia, Singapore and the U.K. and it has its subsidiaries in Japan and Germany. 

The startup unicorn mainly provides two types of core products. These are their endpoint backup platform InSync and a remote server backup product known as Phoenix. In 2016, the company launched the Druva Cloud Platform that provides the entire enterprise cloud system to the organisations. 

Business Model 

The company's main aim is to see that different enterprises and businesses are able to store and manage their data effectively and efficiently. To do this, they provide a wide range of software products and solutions, and an online, cloud-based platform.

Druva, through its website called www.druva.com, tries to provide information on its various products, target industries, and operating locations to all its shareholders. The startup does not operate an online sales portal, but it allows customers to register for product trials directly through its website, and these trials include a certain interest or fee. The company also operates an online platform and client portal with the help of which customers can access a wide range of tools and resources that might be helpful for them.

For making its sales, Druva uses its in-house team. It is done through a direct sales force, which is segmented by different geographic regions, and clients can be contacted over the phone or through an online medium. The sales personnel of the company operating out of its network of sales and administrative offices across the Americas, Asia Pacific, and Europe, including locations in the U.K., Singapore, India, Japan, Australia, and Germany.

Druva also offers products and solutions through various channels and distribution partners. This also includes value-added resellers, sales agents and distributors that help the company to extend its reach, especially in some specific international markets.

The enterprises that Druva serves belong to different industries. These industries include technology industries with services being offered to software companies and web developers. It also includes professional and financial services like consulting, accounting, banking institutions, financial institutions, etc. Services to educational institutions like schools and colleges are also offered.

How did Druva raise funds?

Druva Inc came into the market initially through bootstrapping. All the resources and capital were raised by self-funding. It was in 2010 that it received its first funding of $5 million from Sequoia Capital and Indian Angel Network. Then in 2011, the company also raised a Series B funding of $12 million from Nexus Ventures. Around $25 million was raised in both the Series C and Series D rounds. 

The 2014 fund was raised at a valuation of $14 billion. Further, the startup also raised an amount of $51 million from various investors like Hercules Capital, Blue Cloud Ventures, Sequoia India, etc. 

The company raised close to $130 million in a Series G round of funding. This new round was held in 2019 and was led by Viking Capital after which the company's valuation crossed $1 billion, and the startup got the tag of a unicorn. This round witnessed participation from investors like Nexus Venture Partners, Riverwood Capital, Atreides Management, etc. 

The money raised would be mainly used for innovating new products and devising new strategies that would help the firm in its future expansion plans. This capital will also be used to make new acquisitions that would majorly be tech acquisitions. Other than that some of the money raised will also be used for marketing. 

The company is expected to reach revenues of around $100 million, and with that, the next most logical step for them seems to be to go for an IPO. Druva raised finances in the late stage from a public investor like Viking Capital, and it seems that it would go for an IPO within 12-18 months. 

Competitors

Druva functions as the only all SaaS- all cloud data protection product in the market that has been built on Amazon Web Services. When we take a look at the competitors of Druva, we can see that there are multiple. The competitor companies are also Cloud-based, so it becomes important for Druva to differentiate themselves. 

The competitors include Veeam Backup and Replication that have virtualisation centric backup. It offers image-based V.M. replication, instant V.M. and file recovery. Then in the centralised network backup sphere, the company faces competition from companies like Veritas, IBM, Legato and Commvault. Other than that, Data Domain and Quantum also have target duplication, and companies like Cohesity and Rubrik provide hyper-converged data protection. 

Druva hasn't started with many of these features yet and so it needs to set itself apart from its competitors.

Growth 

The industry for data protection has been showing a continuous increase in its growth and it is likely to continue to expand. The market size of this industry is expected to increase $55 billion by 2020. Druva has taken on a good approach to adapt to this growing industry, as the adoption for Cloud has increased in recent years. 

There are a few challenges ahead of Druva, as it moves forward. Today, data comes not only from smartphones or laptops and computers. Nowadays, data also comes from sources like surveillance cameras, internet of things (IoT), medical devices, etc. 

Initially, the product was sold as a software licence, but now it works as a service model. The changing technology has kept the company on its toes, and that is why it had to adapt itself to even introduce Cloud services.

Going Forward

Going forward, Druva Inc will be investing more into Research and Development. It will also be investing in new solutions around data intelligence using machine learning and analytics and will also be focusing on providing more workload coverage. 

The company currently operates in seven countries and would like to expand to Australia and the Nordics as well, however, their current focus is on getting deeper into the markets that they are already operating in rather than expanding to other countries.