When WANdisco floated on the London Stock Exchange in June 2012 big data was very much in its infancy as a disrupting force in the technology sector. Fast forward two years and the company has carved out a niche and seen continued interest in its offering, which helps organisations make use of unstructured data.
Whereas in previous eras when businesses tooled themselves up with big in-house teams of technologists, WANdisco is taking advantage of a growing trend of outsourcing and getting specialists to maximise the potential of data.
Having spoken to the room at SUMMIT: The Future of Growth about how big data is transforming the way we live, GrowthBusiness caught up with company CEO David Richards to find out how the business got to where it is today, and what the plans are for the future.
Why did you pick AIM as a platform for growth?
First of all the company was started in 2005, and has never raised venture capital. So we spent seven years growing the business through customer acquisition. Then we saw a moment where we thought we needed the capital infusion to pivot the business from essentially ALM to big data, as we could see big data happening over the horizon.
We looked at various potential sources for doing that: debt, venture of public markets. Now the public markets are good as naturally there are massive amounts of cash available and really to super charge and get the hyper growth business we wanted you need capital markets to support that.
Companies like SalesForce.com have grown in the public markets very well – 35 per cent CAGR over 10 years. So you can have hyper growth companies in the public markets and that is why we chose it.
Now, looking specifically on AIM – which is more interesting I think – as in the US if you have less than $100 million of revenue no one is going to look at you. London has this unique jewel in the crown called AIM, which fills the void between the 5/10/15 million dollar businesses up to $100 million.
What else about the UK has been instrumental to your growth?
A lot of criticism is levelled at the investment community in the UK, saying they don’t understand tech. They just don’t have enough really good tech businesses to invest in. If you look at the public markets and analyse the valuations that have been given to companies like ours that are fast growing, that have real technology and real intellectual porosity, they will fund those businesses.
If you have a business with real IP that is playing in a huge market place, then you will get same reward on AIM or the LSE as you would on the NASDAQ. And if you look at us, 15 per cent of our shareholder base is US-based funds in any case as they can buy shares on London market.
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How would you describe the opportunities big data provides to entrepreneurs and businesses?
Big data is the most disruptive technology of a generation. If you look at what is happening in the assisting enterprise applications market, at the highest level it is a $150 billion market. For vendors in there such as Oracle, Teradata, SAP, what is happening is that their growth has stalled. Now companies don’t just stop buying applications.
Don’t think about big data as a lot of data, it is an enterprise application platform and is the fundamental source of competitor advantage across every industry, so participation in this movement is absolutely essential. Nobody should be building enterprise applications that are built on a relationship database, as they will be displaced.
We are seeing massive disruption in very conservative organisations like banks, which are ripping out their data centres creating costs savings that run to 80 per cent – and this is creating a new breed of technologies. It’s similar to the same way that Oracle existed after the mainframe.
There was a very famous incident when in 1977 the CEO of DEC said the PC was going to fall flat on its face and why would anyone want a computer at home. How wrong could he be? And people are going to say exactly the same thing about big data, that entrepreneurs need to ignore it and think about how they participate in it.
How does an entrepreneur like yourself now not get left behind by next wave?
You really have to shoot ahead, make projections on product lifecycle adoption where you think the market is going to go to. What a lot of companies in the UK have done is after the move has happened. WANdisco made the prediction in 2010 and we said very clearly that the new generation of enterprise applications would be built in a specific way, we were absolutely right.
We came to market and the precise pivot big data was hitting enterprise. Otherwise the market has already switched and you’re trying to create a company after the fact. It is highly likely someone else will be doing it and if adoption is happening then you won’t have products ready for market.
A very good investor once talked to be about the second bounce of the ball. The first bounce of the ball is companies are going to move their data centre architecture to big data, but what is the second bounce. The second is a fundamental change in the way that companies do business. Are people really going to have newspapers delivered through letter boxes in ten years time? If I look at what my kids are doing now, they are not reading newspapers they are reading everything online. It’s pretty obvious that market is going to shift, so companies need to think about the second bounce of the ball not current one.
What specific things are you doing to stand out in the big data market?
It is all about execution. Our goal in life is to become the continuous availability layer in the big data stack. Nobody can say we are going to be all of big data and create a $150 billion company overnight. We execute properly and that is the layer of the stack that we are focused on. We don’t want to be all of big data; we want to be the thing that makes big data resilient for enterprise usage. So it is a very very focused approach on execution in one small area of that stack – and the rewards for success there are huge.