Is that a Veeam in HPE's eye? IT giant may gobble backup biz

Veeaming Megsco could be about to do a Data Domain and buy big

Hewlett Packard Enterprise is interested in buying Veeam, sources tell us.

This sounds like speculation because it would be such a good acquisition for HPE – giving it the world’s leading independent backup software company and being, in a software sense, the equivalent of EMC buying Data Domain.

However, HPE has recently bought SimpliVity for $650m and is buying Nimble Storage for $1.2bn – meaning it’s spending $1.85bn buying two suppliers. Does it have the appetite for a third?

Veeam was founded in 2006 by CTO Andrei Baranov and President Ratmir Timashev. It had an undisclosed funding round in 2013. It is based in Baar, Switzerland. Its revenue and customer growth has been fantastic as it mined the golden backup seam of virtual machine protection better than anybody else. In January we learnt Veeam had:

• 230,000 customers worldwide with almost 50,000 added in 2016,
• Historical average of approximately 4,000 new customers every month,
• Enterprise licence bookings grew 57 per cent annually,
• Number of new enterprise customers grew 48.6 per cent to 761 annually,
• 13.3 million virtual machines are protected by Veeam Availability SW,
• Veeam has 45,000 ProPartners worldwide.

Set against this horticultural backup splendour, HPE’s own backup SW looks a relatively spindly thing. In June last year Gartner placed Veeam in the leaders’ quadrant in its "Magic Quadrant for Data Center Backup and Recovery Software.” HPE was placed in the Challengers’ box.

The cross-selling opportunities, were HPE to buy Veeam, look quite appealing.

Back in February 2016, HPE acquired Switzerland-based Trilead and its VM Explorer product for VM protection and a mid-market backup offering. This helped strengthen its backup portfolio with its StoreOnce product.

Veeam's full 2016 year revenue bookings revenues were $607.4m. That suggests an acquisition price in the $1.5bn to $2bn area might be attractive to Veeam's owners, if they were minded to sell.

A 10-year Veeam vet and EVP William Largent became Veeam CEO in 2016, replacing Timashev, who currently has no operational role on Veeam’s leadership web page.

On being asked about this potential acquisition, an HPE spokesperson said: "We can't comment on rumours or speculation of that nature."

Veeam similarly said: "We don't comment on rumour or speculation." ®