Cloud services enabler and broker BitTitan, has closed a $15 million Series A financing round led by TVC Capital, a San Diego-based growth equity firm focused on investments in enterprise software companies, in addition to participation from Tao Capital Partners, a San Francisco-based family office, the company announced Friday.
Some notable firms in the portfolio of Tao Capital Partners includes SpaceX, Tesla Motors, Google’s DeepMind and Uber.
For BitTitan, which was founded in 2007 by CEO Geeman Yip, this is its first equity financing investment since inception. According to the company it will use the financing to further establish its market position in the cloud services enablement space, as well as augmenting its MSPComplete platform with more managed services automation capabilities, and pursue market expansion.
Responding to queries on their Indo-Asia Pacific growth plans, Yip told DEALSTREETASIA: “In the Indo-Asia Pacific region, our investment will be used to immediately expand our presence in this region by way of staffing in order to service the market. We will also be using the investment to ensure that all of our products are localized for the market not just in language but also in functionality to service its unique needs.”
The transaction also sees Steve Hamerslag, managing partner at TVC Capital, joining the company’s board of directors. Commenting on the investment, Hamerslag said, “BitTitan is our largest Series A funding to-date. It is rare for a bootstrapped company to have achieved BitTitan’s degree of growth, and we regard this as a testament to Geeman’s fearless leadership and the exceptional management team he assembled.”
“Serving on the board, I look forward to working with this proven and dynamic team as they continue to expand globally and help shape the cloud services market,” he added.
Claiming to be amongst the first teams to offer cloud services brokerage (CSB) market, BitTitan’s main offering is MSPComplete, which it describes as “a comprehensive platform enabling IT service providers to grow cloud revenue,” essentially serving as a platform for IT service providers to sell more cloud products and onboard customers to the cloud.
Some of the partnerships and cloud ecosystems that BitTitan supports includes the likes of Microsoft, Amazon, Google, and Dropbox. The firm claims a workforce estimated at 200 people globally, with around 30 people based in Singapore.
Market outlook & BitTitans niche
The cloud services market is only set to see significant global growth in the coming years, with Gartner forecasting that the global public cloud services market will reach a capitalisation of US$204 billion this year. This is coupled with predictions by IDC that worldwide spending on public cloud services will grow at a 19.4 per cent compound annual growth rate (CAGR) — almost six times the rate of overall IT spending growth – from nearly $70 billion in 2015 to more than $141 billion by 2019.
According to IDC, Software as a Service (SaaS) will remain the dominant cloud computing type, capturing more than two thirds of all public cloud spending through most of the forecast period. Worldwide spending on Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) will grow at a faster rate than SaaS with five-year CAGRs of 27 per cent and 30.6 per cent respectively.
“Over the next five years (from 2016 through 2020), over $1 trillion in compounded IT spending will be directly or indirectly impacted by cloud shift, making cloud computing one of the most disruptive forces of IT spending since the early days of the digital age,” wrote Ed Anderson, research VP, and Michael Warrilow, research director, at Gartner.
In email communications with DEALSTREETASIA, when asked to comment on where he saw the cloud computing space evolving in the near term, Yip elaborated:”The cloud is made up of 3 things: IaaS, PaaS, and SaaS. IaaS is very mature and pricing continues to drop because of competition and large scale manufacturing. The major players are really Microsoft, Google, Amazon and Alibaba. Near-term, pricing will continue to drop. It will be hard for others to enter this market.”
Yip continues, “PaaS is used by the application developer market. Microsoft, Google and Amazon are all scaling their PaaS offerings rapidly in conjunction with their IaaS offerings. It’s a smart move by them to own the developer market to make their platforms prevail and be the standard for all SaaS applications. Near-term these players will continue to grow their PaaS offerings faster and offer as many building blocks as possible to own the developer market.”
“Finally, there are SaaS offerings which are the applications used. Near-term there will be more and more of these SaaS offerings being spun up and is largely due to the IaaS and PaaS components commoditized and now SaaS developers can focus on their core problems they are solving rather than the common components needed by all SaaS applications.” he added.
According to BitTitan, since founding it has grown top line revenue 50 to 100 percent in each of the last five years and has doubled its number of partners within the last year. In response to how he saw cloud services developing in Asia, Yip explained to DEALSTREETASIA: “Currently cloud services in the Asian market is still in its infancy with respect to adoption. I expect in the next 4 years, the market to mature to the same level where the US is today.”
Speaking on the role of the Singapore office, Yip shared with DEALSTREETASIA: “BitTitan is a global company not just in customers but also in operations. Outside of sales, all of our offices, including Singapore, services globally.”
He added, “For example, our engineering team works on the same products as the US, our IT works on the same infrastructure that is common to servicing all of our employees and customers. This allows us to provide 24 hour operation in all aspects of our company. Regionally, Singapore is the hub for all of our Asian customers.”
Figures from a media release issued by BitTitan claim it has “helped over 4 million users from more than 100,000 companies spanning 125 countries adopt the cloud” and maintains a partner ecosystem that includes in excess of 7000 managed service providers (MSPs), systems integrators (SIs), and distributors that include firms like Ingram Micro, Tech Data, HP, IBM, Avanade, Rackspace, New Signature, Softbank, and SADA Systems.
Speaking on the transaction, Yip said, “The decision to partner with TVC Capital was less about the money, and more about Steve and his team’s domain expertise and hands-on approach to helping us expand and further dominate as a cloud leader. BitTitan started in my basement, and for the past nine years, we’ve bootstrapped our way to tremendous growth.”
“This funding validates us both as a leader in the cloud services enablement market and as a disruptive force in modernizing the process of moving mission-critical workloads to the cloud. We are eager to begin this chapter alongside the wealth of experience and genuine commitment TVC Capital brings to the table,” Yip concluded.