Boston hot cloud storage startup Wasabi has pulled in $30 million in a new institutional funding round.
The round was led by Forestay Capital, the technology innovation arm of Waypoint Capital, with participation from Wasabi’s previous investors. It brings the startup's total funding to $110 million.
Founded in 2015 by former Carbonite CEO and serial entrepreneur David Friend, Wasabi focuses singularly on hot cloud storage. Friend believes that focus is what will lift Wasabi above its competitors—and potentially make it "a unicorn in a few years," he said in an interview with BostInno.
"We just want to be the best cloud storage vendor in the world," Friend said. "We’re not going to have 100 other products like Amazon has, or 240 products like Microsoft, or anything else. Storage is going to keep us going for a long time."
Friend likened the cloud storage business model to that of a landlord. The landlord borrows money from a bank or other investor and buys an apartment building. When that building is at 60 to 70 percent occupancy, it starts generating a profit, and the landlord can move on to the next building, Friend said. Wasabi does the same: Data storage centers are its apartment buildings, and companies' data are its tenants.
Friend also noted that the new investment comes just in the nick of time. Investors have already begun tightening their purse strings amid the pandemic, but now that Wasabi has secured the funding, Friend thinks that could be an advantage: "The door kind of slammed behind us," he said.
With the new funding, Wasabi plans to keep moving at a breakneck pace to drive the price further below that of its competitors. Wasabi currently prices its cloud storage at $0.0059 per GB/month. Amazon's standard plans, by contrast, start at $0.021 per GB/month.
That price discrepancy has led new customers to Wasabi, especially as companies begin looking critically at their 2020 budgets.
"When the virus hit and people hunkered down at home, a lot of attention turned to, 'How do we save money?'" Friend said. "Some of these simple money-saving projects, like 'let's migrate our data to Wasabi,' started to surface and get to the top of the pile. We continue to have record week after record week."
Wasabi will also continue expanding internationally, a move it started last fall when it inked a deal with Tokyo-based NTT Communications. Although the coronavirus has slowed down some of the initiatives NTT and Wasabi are collaborating on, the deal has sparked interest from other potential international partners, Friend said.
"We'll expand our geographic footprint and push storage out closer to the customers," Friend said. "Our plan is to build a worldwide network of data centers to serve international companies that have locations all over the world and accommodate people who worry about where their data is stored."
