|
|
| Home - CEO Spotlight - Oct 05 Issue |
CEO Spotlight: Bob Cramer, Live Vault
continued... page 2 |
Angel Mehta: Let's talk about LiveVault. Storage and data protection has been a bright light for software over the last few years, but like any hot space, it's become cluttered. How has LiveVault found its niche?
Bob Cramer: LiveVault started in 1993 and actually invented the concept of online backup and continuous data protection (CDP) for businesses. The problem we address is that tape-based backup and recovery simply doesn't work. It's been done the same way for 30 years - since the days of mainframes and batch processing. Even today, nearly every business in the world has someone take a tape, stick it in their business's computer server, run a back up job, take the tape out, label it and physically move it off-site for disaster recovery. About $3 billion a year is spent doing that process just in the SMB market alone. And analysts estimate that between 20% and 50% of these tape backups fail to fully recover in a disaster because it's such a complex process - prone to human error, physical loss or media failure. We thought a $3B annual spend with such a high failure rate presented a huge opportunity for displacement.
Angel Mehta: So it is a $3 billion market, of which a large percentage just doesn't work?
Bob Cramer: Right. What we saw was that disk prices were plummeting and were going to continue to plummet. And high bandwidth was becoming widely available at relatively low costs. That enabled an entire paradigm shift from this manual physical thing to protect business data to being able to fully automate end-to-end data protection -- backup, automatic off-site protection, archival, and recovery. All this in one single, integrated, completely automated process managed through a simple web management interface. LiveVault's backup and recovery as an ASP service, much like Salesforce.com did in CRM, was the vision for LiveVault in 2000.
What happened though is that we were 120 people with very little revenue…a huge market cap, like many startups at that time… and then of course the capital markets dried up. As an outside board member, I was trying to help determine what direction to take the business in; and in the process of examining the company, I just fell in love with some of the technology assets, people, and vision. So I offered to step in and run the company. We brought it down to about 30 people and did a re-capitalization in December of 2001.
It wasn't the "in" thing to be doing in 2001, I suppose. The whole investment world was running away from the internet, and who could blame them? We were a channel-based delivered service to the SMB market. Everything that VCs didn't want to touch back then - most investors were looking at large software companies sold through a direct sales force.
Of course, today the ASP model is the thing to do and selling to SMBs is a brilliant idea because that's where all the buying is happening. But it was very contrarian at the time.
Angel Mehta: What persuaded you to stay the course when common sentiment suggested you were on the wrong path?
Bob Cramer: It's a basic concept that is simple in theory, but hard to remember when you're in the heat of the moment: stay focused. I'm sure the first 3 years for Tom Siebel were hell - of course, everyone looks back at it and says, 'Wow, CRM was so obvious." But it wasn't. It's never obvious or easy to get traction when you've got something new. Staying committed to your vision and focused is an immense psychological challenge in those circumstances - but essential to success.
Angel Mehta: What tactics did you employ early to build credibility into the LiveVault brand?
Bob Cramer: We didn't initially. We realized early on the need to partner with large players and piggy back on their brand equity. So we signed OEM deals with companies like Iron Mountain whose server electronic vaulting service (based on LiveVault) is the "electronic version" of their tape pick-up business on trucks. IBM also private labels LiveVault's online back service. So does HP, Lexus Nexus, Kodak, BT, and many others. We also looked at each targeted vertical and asked who is the trusted partner for that customer, and then worked with them. Building a strong brand for a startup is extremely expensive and nearly impossible - so we leveraged others. Over time, that credibility has transferred to the LiveVault brand.
Angel Mehta: What are you most paranoid about right now, as far as LiveVault's future is concerned?
Bob Cramer: The fact that we are doing so well means that we're going to wake up the sleeping giants. Microsoft, Symantec, EMC… all these guys are realizing that SMB backup and recovery is huge - and wide open for a new leader. Disk is unquestionably going to replace tape for backup, and bandwidth is going to replace trucks to get that data off-site -- it's only a matter of time before they figure this out. We've got to run very fast before they jump in - while at the same time working both with and around the big players. It's a huge challenge and some days it's scary as hell - but it's also a great problem to have.
Bob Cramer has been the President and Chief Executive Officer of LiveVault since 2001. His extensive executive management experience in fast-growth environments includes President and CEO of FirstSense Software, Inc., general manager of Marcam Corporation, and President and CEO of SET. Bob has also held senior marketing and sales positions at Oracle Corporation, CenterLine Software and INGRES. For article feedback, you can contact Bob at: bcramer@livevault.com
Angel Mehta is Managing Director at Sterling-Hoffman, a retained executive search firm focused on VP Sales, VP Marketing, and CEO searches for enterprise software companies. He can be reached for feedback at: amehta@sterlinghoffman.net
 
|
|
|
