Datto, Inc.

Datto, Inc.
Industry
Founded 2007
Founder Austin McChord
Headquarters 101 Merritt 7, Norwalk, Connecticut, United States
Area served
 Global
Products
  • SIRIS
  • ALTO
  • dattoNAS
  • GENISIS
  • Backupify
Number of employees
 600 (2016)
Website www.datto.com

Datto is an American company that provides products and services for business continuity, planning and disaster recovery. It offers a combination of on-premises, virtual, and cloud-to-cloud data protection.

Datto’s Total Data Protection platform encompasses a suite of proprietary software and hardware alongside a 180-petabyte[1] private cloud to store and restore data across a client’s physical and virtual servers as well as SaaS applications. The recovery time in case of disaster is about six seconds on the average.[2]

Valued at $1 billion,[3] Datto closed out 2015 at over $100 million in revenue.[4] The company has millions of customers across thousands of partners worldwide.[5]

History

2007-2012: Early years and fast growth

Datto was founded in 2007 by Austin McChord, an RIT graduate[6] who was born in Norwalk and grew up in Newtown. He was 21 years old. During the first year, McChord worked alone, focusing on engineering and the technology.[3] He developed the original product in his father's basement in Wilton.[7]

McChord hot-glued Linksys boards into his own data backup devices and wrote the software for them. A 2008 article in Gizmodo attracted the first customers.[8] Then he built a system that synchronized data between two computers. He did not use venture capital funding, but ran up $80k in credit card debt to keep his business afloat.[9]

A firm called Zenith Infotech was a leader in the backup industry, creating a product that took over for a small business server when it failed. Datto was able to improve upon the product, offering not just backup but also business continuity, and sell it at a better price. Zenith was driven out of business in 2014.[10]

Datto's Backup NAS offered affordable off-site storage for small businesses. A major breakthrough was the Z Series, hailed as the "planet's first on and off-site backup solution to use ZFS."[11]

McChord decided in mid-2009 to rely on managed services providers to resell and install Datto technology alongside other complementary IT offerings. A few years later, thousands of international channel partners would market Datto products.[10][2]

By the end of 2009 Datto was doing $70,000 in monthly sales and hit a total of $3 million for 2010. McChord released a new product called Aurora that could restore down systems in about an hour. A few months later, he released SIRIS, which cut recovery time to six seconds. Sales hit $9 million in 2011 and $25 million in 2012.[12]

The company was ranked 38th in Inc. 5000 list of the fastest-growth companies in the country.[13] In early 2013, an established security firm offered to buy McChord out (the company’s sole shareholder) for more than $100 million, but he refused since he did not want to dismantle the company.[14]

2013-present: VC financing and platform expansion

In September 2013, Datto raised $25 million in its first round of venture capital financing, led by General Catalyst Partners, with Paul Sagan (former CEO of Akamai) and Steve Herrod (former CTO of VMware) joining the company's board. At the time, Datto had grown to 225 employees, with customers on six continents, including Susan G. Komen for the Cure and several National Football League teams.[15][12]

Datto purchased Backupify, a startup in Cambridge, Massachusetts that backed up data in cloud apps such as Salesforce and Google Apps, in late 2014.[12][16] The purchase enabled Datto to protect data wherever it was, whether in a private data center or in the cloud. Up until then Datto had dealt mostly with SMBs, but buying Backupify gave it access to larger corporate clients.[17] It expanded Backupify technology to add cloud-to-cloud backup of Office 365.[18]

On a partner conference in June 2015, Datto introduced its DNA Router, which offered remote configuration and 4G failover to protect data in transit, along with file syncing and sharing capabilities delivered in collaboration with open-source enterprise software provider ownCloud.[2]

In August 2015, an FBI probe of Hillary Clinton's private email extended to Datto after the firm revealed they had been using a server to backup all of the Secretary's emails.[19] Senator Ron Johnson expressed "major concerns" that classified information was contained in Datto's servers since they lacked the necessary security clearance.[20] Datto had been hired to provide backups for the Clinton e-mail accounts starting in May 2013 by Platte River Networks, a firm hired earlier that year by the Clinton family to manage the system after Hillary Clinton concluded her term as secretary. Datto backed up the server in the cloud.[21] The FBI has been investigating whether classified information may have been improperly stored and transmitted through Clinton’s private server. Datto received consent to turn over data from the Clintons and from Platte River.[22]

Datto raised $75 million from Technology Crossover Ventures in November 2015. It is investing the money into a mix of geographic expansion in EMEA and Asia-Pacific and product innovation. The investment valued Datto at $1 billion.[3] The company ranked 134th in Fortune's 2016 unicorn list[23] and was described as "a rare unicorn... that’s also profitable."[24] In fact, Datto closed out 2015 at over $100 million in revenue.[4]

As of February 2016, Datto employs about 350 people in Norwalk. With other offices, Datto has 600 people overall, including at a site in Monroe where light assembly work takes place on the data storage devices. Over 65 percent of their employees are located in Connecticut.[3] The company has offices in Boston, Rochester, Reading, Toronto, London, and Australia.[7][6]

Products

The Datto platform is built around the idea that small businesses need backup as much as large firms.[10] The hardware and software built by Datto can capture a snapshot of a company’s entire IT system as often as every five minutes. Since the system sits on the customer’s premises and in the cloud, the company can get back up and running from anywhere as long as it has an Internet connection.[12]

Datto protects data on-premises, in the cloud, in physical and virtual servers, and in SaaS applications, and allows its clients to manage it all from a single interface. In case of a disaster, it not only delivers lost data, but keeps the client's business running in real time. The client can run a single server or their whole network from the Datto cloud while the initial problem is resolved.[25]

Datto is the only hybrid-cloud BDR/IBC vendor that provides instant on- and off-site virtualization. The Datto product line consists of three families:

ALTO is a product for small businesses that combines on-site archiving with off-site backup in the cloud. It teams a storage hardware appliance that handles image-based system backup of systems with a cloud backup service that virtualizes applications and servers so that they can be restored from afar if the local system fails or malfunctions.[26]
SIRIS is a family of enterprise business continuity solutions, available in both physical and virtual platforms, built from the ground up, for businesses of every size. Virtual SIRIS, released in June 2014, has an enhanced feature set able to spin up local recovery virtual machines instantly, even in the absence of Internet connectivity.[27]
The network-attached storage (NAS) device automatically syncs its entire content to a remote server, creating an off-site backup copy in case of disaster. In case of burglary, the NAS device can also be remotely commanded over the Internet to permanently destroy the data it contains.[29] It adds snapshotting and syncing to the cloud.[30]

Other elements of the Datto platform:

It converts customer data into a universal file format each time backup occurs. Because the most recent backup image is at the top of the chain, data is always available for immediate virtualization, on- and off-site.[2] There is no conversion process on restore. A copy-on-write deduplicated file system backs everything up and the data are stored as a VMDK (virtual machine disk file). When taking the backup of the machine, Datto updates the VMDK and uses the copy-on-write engine inside the file system to keep hundreds of versions of that VMDK.[18]
It uses AES-256 encryption and customers can optionally add another layer of encryption on top of the Datto data stream. Datto can spin up clients’ applications in a segregated area to isolate them from anyone else running in the cloud and also provide exclusive access to them via a secure connection. They also have a feature called Screenshot Backup Verification, where they simulate a recovery operation, spinning up virtual machines from backups and verifying that they can be booted in a disaster recovery situation. They then take a screenshot of the completed boot process and email it, along with the results of the testing, to the user.[31]
The company open sourced the development of its Linux Agent, which is being used by thousands of users.
It is the company's own router-firewall-Internet security appliance. Datto DNA Router is separate from the company's storage appliance. Datto launched the DNA because one-third of their support tickets were due to bad network configurations.[18]
Datto Drive is the company's file sync and sharing product which competes with companies such as Box, Dropbox, and other cloud storage companies.[32]

Datto’s data centers are located in Reading, Salt Lake City, as well as in Canada, U.K., and Australia. Datto uses several colocation providers, but one of its large locations is with C7 Data Centers in Utah.[33] Curiously, the country with the most Datto data storage devices per capita is Greenland, because of the ice core research stations there.[3]

Datto sells its offerings through managed services providers.[4] Its business partners include such companies as Kaseya, AVG, AutoTask and ConnectWise.[34]

There were several actual disasters which tested the Datto platform. A massive tornado tore through Joplin, Montana in 2011, but Datto instantly retrieved local hospitals’ access to medical records. After Hurricane Sandy swamped the system of New York hedge fund Richmond Hill, Datto had it back in the market in minutes.[12] In the UK, the main office of a Derbyshire-based estate agent burnt down in 2014, but was up and running next morning at another office. A Birmingham office outfitter suffered a server failure but restored operations from an image taken a few hours before.[35]

Awards and recognitions

Datto has received several awards for its rapid growth, including being named Connecticut's Fastest Growing Technology Company for several years,[7] as well as the most funded startup in Connecticut as of February 2016.[36] It made the Inc. 5000 list in 2012, 2013 and 2014.[37] The company was ranked 29th in Deloitte's Fast 500 for 2014.[38]

Forbes 30 under 30 listed Austin McChord among the rising stars of enterprise technology in January 2015.[14]

The company has received numerous other industry awards, for company growth, product excellence and technical support.[37]

References

  1. ↑ "Datto Expands Executive Leadership Team to Fuel Rapid Business and Geographic Growth". Datto. 16 February 2016. Retrieved 15 March 2016.
  2. 1 2 3 4 Jason Ankeny (8 September 2015). "How Datto's Austin McChord Brings IT Systems Back From the Brink of Destruction". Entrepreneur. Retrieved 15 March 2016.
  3. 1 2 3 4 5 "Datto continues rapid expansion in Norwalk". Stamford Advocate. 7 February 2016. Retrieved 14 March 2016.
  4. 1 2 3 Spencer Smith (8 January 2016). "Datto Siris: Hardware prices drop after lucrative 2015". TechTarget. Retrieved 14 March 2016.
  5. ↑ Ben Kepes (12 June 2015). "ownCloud And Datto Partner To Secure Private File Sharing". Forbes. Retrieved 15 March 2016.
  6. 1 2 RocCityNews (22 January 2016). "A glimpse of a new downtown". Creating Downtown. Retrieved 14 March 2016.
  7. 1 2 3 McClatchy-Tribune (5 February 2016). "Norwalk-based Datto unveils impressive expansion [The Hour, Norwalk, Conn.]". Bloomberg Business. Retrieved 14 March 2016.
  8. ↑ Jason Chen (28 July 2008). "Datto's ZR Series Drive Improves Internet Backup Solution With Gigabit Ethernet, RAID and ZFS". Gizmodo. Retrieved 15 March 2016.
  9. ↑ Justin Warren (6 January 2016). "The Eigencast 004: Austin McChord, Founder and CEO, Datto". EigenMagic. Retrieved 15 March 2016.
  10. 1 2 3 Kerry Feltner (4 January 2016). "Entrepreneur invents his own path". Rochester Business Journal. Retrieved 15 March 2016.
  11. ↑ Darren Murph (29 July 2008). "Datto's Z Series: world's first on / off-site backup solution to use ZFS". Endgadget. Retrieved 15 March 2016.
  12. 1 2 3 4 5 Steven Bertoni (11 February 2015). "Datto: The Secret Tech Money-Making Machine You've Never Heard Of". Forbes. Retrieved 15 March 2016.
  13. ↑ "Inc. 5000 2015: The Full List". Inc. Magazine. 2012. Retrieved 14 March 2016.
  14. 1 2 Bruce Upbin (5 January 2015). "Faster, Cheaper, Younger: Meet 30 Under 30 Rising Stars Of Enterprise Technology". Forbes. Retrieved 15 March 2016.
  15. ↑ Michael J. De La Merced (3 September 2013). "Datto, a Data Backup Service, Raises $25 Million in Round Led by General Catalyst". The New York Times. Retrieved 14 March 2016.
  16. ↑ Gregory T. Huang (16 February 2016). "A.I. Startup Talla Tracks Down $4M From Avalon, Others". Xconomy. Retrieved 15 March 2016.
  17. ↑ Ron Miller (11 December 2014). "Datto Snags Cloud Service Backupify". TechCrunch. Retrieved 15 March 2016.
  18. 1 2 3 Garry Kranz. "CEO: Datto backup roadmap emphasizes cloud". TechTarget. Retrieved 3 September 2015.
  19. ↑ Laura Koran, Evan Perez (8 October 2015). "Employees at company working with Clinton email server expressed concerns". CNN. Retrieved 8 October 2015.
  20. ↑ Ed Henry (7 October 2015). "Clinton email investigation expands to second tech firm". Fox News. Retrieved 15 March 2016.
  21. ↑ Nicole Lee (15 January 2016). "House Science panel opens new investigation into Clinton emails". EndGadget. Retrieved 14 March 2016.
  22. ↑ Tom Hamburger, Rosalind S. Helderman (7 October 2015). "FBI probe of Clinton e-mail expands to second data company". The Washington Post. Retrieved 13 March 2016.
  23. ↑ "The Unicorn List 2016". Fortune. 2016. Retrieved 14 March 2016.
  24. ↑ Joe Panettieri (17 November 2015). "Datto Raises $75 Million for...". Channel 2e2. Retrieved 14 March 2016.
  25. ↑ Brian Taylor (20 July 2015). "Datto's 6 seconds restore capability keeps SMBs online during a disaster". Tech Republic. Retrieved 15 March 2016.
  26. ↑ Heather Clancy (17 April 2013). "Datto introduces hybrid disaster recovery solution". ZDNet. Retrieved 15 March 2016.
  27. ↑ "Datto Strengthens Backup Offerings With Virtual Appliances". StreetInsider.com. 14 October 2014. Retrieved 15 March 2016.
  28. ↑ "Top 25 Cloud Backup Enablers List for January 2016 – Backup Review". Storage Newsletter. 4 January 2016. Retrieved 15 March 2016.
  29. ↑ Dong Ngo (26 June 2008). "Datto: Off-site backup made easy". CNET. Retrieved 15 March 2016.
  30. ↑ "Products". Datto. 2016. Retrieved 15 March 2016.
  31. ↑ Jim Whalen (14 March 2016). "Compliance in the Cloud". Datamation. Retrieved 15 March 2016.
  32. ↑ Konrad, Alex (2 May 2016). "Billion-Dollar Startup Datto Gives Away Free Storage In A Challenge To Dropbox and Box". Forbes. Retrieved 24 May 2016.
  33. ↑ Jason Verge (15 January 2015). "The Data Centers Behind Datto's Backup for Everything". Data Center Knowledge. Retrieved 15 March 2016.
  34. ↑ Edward Gately (27 January 2015). "Datto Intros New Partner Community Forum". Channel Partners. Retrieved 15 March 2016.
  35. ↑ Chloe Green (22 December 2015). "The perfect storm: seven steps to secure your business against disaster". Information Age. Retrieved 15 March 2016.
  36. ↑ Kristin Pryor (1 February 2016). "The Most Well-Funded Startups By State". Tech.co. Retrieved 14 March 2016.
  37. 1 2 David Gurliacci (21 January 2015). "CEO of Datto in Norwalk, on CT Magazine's '40 Under 40' List". Patch. Retrieved 15 March 2016.
  38. ↑ "Deloitte's 2014 Technology Fast 500" (PDF). Deloitte. 2014. Retrieved 15 March 2016.

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