BitTitan was founded by former Microsoft developer Geeman Yip in his basement, and operated for nine years on its own funds, with no outside backing. Today, the Kirkland, Wash.-based company, which helps managed-service providers move end-users to the cloud, is announcing that it has closed on its initial round of financing — raising $15 million from TVC Capital, a San Diego-based growth equity firm with $235 million under management.
Why accept financing now? To fuel growth that Yip says he expects will amount to “multi-hundreds of percents on a year-over-year basis.”
“We have survived by bootstrapping until now,” said Yip, BitTitan’s founder and CEO, in an interview from Singapore, where the company maintains an office so it can operate around the clock. “We have zero outside funding and no debt. Now, to raise this very large round in this very tough economy is a validation of what we’re doing. It feels amazing.”
The firm chose TVC Capital because of its domain expertise and hands-on approach, he said. Tao Capital Partners, of San Francisco, participated in the round. Steve Hamerslag, TVC’s managing partner, will join BitTitan’s board of directors.
“BitTitan is our largest Series A funding to date,” said Hamerslag in a release. “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.”
Yip, a Microsoft developer for 10 years, left that company on a high, optimistic about starting a business on his own. But he quickly found that was a lot harder than he had thought.
“The early days were brutal,” he said. “I was broke, I couldn’t really explain to my family and friends what I was going through, and I had to pivot several times before I found something people were interested in.”
Yip used “every dime” of his savings to fund his company, maxing out his credit cards, moving in with his girlfriend, taking out a second mortgage on his house and drawing no salary, he said. He and co-founder Dominic Pouzin (now the company’s CTO) eventually realized moving data to the cloud was a huge problem and a business opportunity. Once they created their first tool to aid in those moves, they had enough cash to survive on. And they valued their new corporate culture so highly that they didn’t want outside investors to jeopardize it.
The approach earned BitTitan recognition from the Seattle tech community as a finalist for “Bootstrapper of the Year” in the 2015 GeekWire Awards.
BitTitan’s customers, collectively known as managed-service providers (MSPs), include professionals known by various names — IT service providers, value-added resellers and system integrators, among other things. The company currently has 200 employees, in 10 countries. It competes with Dell and even with the companies — Amazon, Google and Microsoft — on whose clouds it operates, he said.
One analyst called BitTitan a market leader.
“There are other products in the migration space and in the automation space, but I don’t think anyone has wrapped it up the same way BitTitan has,” said Liam Eagle, a senior analyst with 451 Research in New York. “The MSPs are the gatekeepers for a lot of business, and figuring out how to help them is a big opportunity. BitTitan has zeroed in on it.”
In October, BitTitan released MSPComplete, software that it said lets managed-service providers sell more cloud services, move customers to the cloud faster, create recurring revenue and service customers in the cloud.
“We had had about 4,500 customers in our first eight years of business, but after we added MSPComplete, we started adding 500 to 1,000 every month,” Yip said. “That’s when I knew we had a big role to play in the cloud market, so we decided to go for it and see how big we could make the company.”