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The world will remember 2020 for a lot of things, many of them negative. The data protection market, though, had a pivotal year, with multiple major acquisitions, emerging trends, and backup and recovery technologies aiding companies that shifted to remote work amid the coronavirus pandemic.
The year started with a bang, when private equity firm Insight Partners acquired Veeam Software at a $5 billion valuation, one year after investing $500 million in the backup vendor. The year closed with another large acquisition, in Google's purchase of copy data management pioneer Actifio.
In between those acquisitions, the coronavirus pandemic hit hard and forced businesses to rethink how they work. It also caused organizations to rethink how they approach backup and recovery technologies, thanks to end users scattered across the world and an increase in cyberthreats.
Rise in remote data protection
As analyst Marc Staimer said in March, "Coronavirus is going to change the way we work -- permanently." In terms of backup and recovery technologies, one piece of that is an increase in endpoint data protection, because so many employees started working remotely. While some workers will go back to the office in 2021 and some already have, signs point to a permanent increase in remote work, so endpoint protection will remain important.
As if the pandemic wasn't bad enough, it also led to an increase in virus-related cyberthreats, including ransomware. Attackers sought to take advantage of remote workers' cybersecurity vulnerabilities. Backup and recovery vendors that integrate cybersecurity elements -- such as Acronis, Arcserve, Asigra, Carbonite and Unitrends -- sought to make their mark with a holistic approach to the problem.
Other vendors stood out in different ways. Critical event management provider Everbridge launched COVID-19 Shield, software as a service that includes targeted pandemic data feeds and rapid deployment templates. Three top business continuity management vendors -- Assurance Software, Avalution Consulting and ClearView Continuity -- rebranded as Castellan Solutions.
Experts and vendors have also noted an increased reliance on cloud products, and that includes cloud-based backup and recovery technologies. As Poojan Kumar, CEO of backup-as-a-service vendor Clumio, described it, "Most vendors are a combination of software and hardware that they bring in that you need to install and run. … An offering that basically takes away all of that drudgery from their hands and protects with a service running in the cloud is so much more compelling."
Count containers in
The container market was another key piece of the puzzle in 2020. As more companies shift to container-based workloads, backup and recovery technologies have come into play in a big way, punctuated by two major acquisitions.
Veeam acquired Kasten for $150 million in cash and equity, months after it launched a partnership with the Kubernetes backup and disaster recovery provider. At almost the same time, Pure Storage bought Portworx for container management.
Several other vendors -- including Catalogic, Commvault, Druva, Trilio and Zerto -- unveiled container-based data protection products or updates. "We're in a land rush," said Phil Goodwin, research director at IDC. "People are fighting for market share."
Funding flows to backup and recovery vendors
Even in a year dominated by a pandemic, it was another big one for funding rounds in the data protection market. While understandably not as big of a year as 2019, which featured several rounds of more than $100 million, backup and recovery technologies were still a hot commodity for investors. Among the vendors that received funding hauls:
- Cohesity topped the list with $250 million, to use for research and development, broaden its global reach and build on partner relationships.
- Zerto closed on a $53 million funding round to help improve its IT Resilience Platform.
- Salesforce backup specialist OwnBackup picked up $50 million, with an eye on expanding its protection to other SaaS platforms.
- Odaseva, another Salesforce data protection provider, raised $25 million to increase its employees and partners, and also plans to add platform support.
- Trilio, which protects cloud-native environments including Kubernetes, received $15 million.
In addition, Datto went public under the stock symbol "MSP," showing its commitment to managed service providers. The year 2021 may see more data protection vendors filing for IPOs. The CEOs of Druva, Rubrik and Veeam have all said they're thinking about it.
Whether it translates to IPOs or not, as the pandemic continues, it's clear that backup and recovery technologies remain as important as ever.