Cloud content collaborator Egnyte is now majority-owned by a pair of private equity companies.
GI Partners (GI) and TA Associates (TA) have bought a majority investment to “infuse Egnyte with the capital and expertise needed to expand its global market presence and accelerate innovation through continued investment in research and development.”
Egnyte was founded by CEO Vineet Jain, CTO Amrit Jassal, CSO Kris Lahiri, and Chief Growth Officer Rajesh Ram in 2007. It has raised $137.5 million thus far across a seed round and four VC rounds, the last for $75 million in 2018. Since then, it has been relying on revenue for continuing operations and growing its business. It had amassed more than 17,000 customers in mid-2023 including Red Bull, Yamaha, and Balfour Beatty. The total customer count is now 22,000.
Jain stated: “This is a significant milestone in Egnyte’s journey and opens exciting new avenues for Egnyters, our customers, and channel partners. The investment and expertise that GI and TA bring will help us accelerate our ability to bring innovative new products and solutions to our existing and future customers as well as deliver accelerated growth and expansion into additional vertical industries and international markets.”
Egnyte was one of several cloud-based file sync and share collaboration startups, along with CTERA, Panzura, and Nasuni.
Cloud file services suppliers operate in an area that overlaps with distributed on-premises file storage. Typically, they’ll use core public cloud object storage and layer file access on top of that, also ensuring that distributed users across an enterprise see files in a synchronized state. They’ll provide fast file access by using local caches. Some, such as Nasuni, want to replace on-premises filers but that general movement has not happened.
Lately, data orchestrators such as Arcitecta and Hammerspace have appeared on the distributed file access scene, adding to the competitive pressures on the original four cloud file sync and sharers.
All four have taken in private equity dollars. None of them felt able to tap VCs for more cash, yet their businesses were solid enough to attract private equity investors.
Panzura went into private equity ownership when it was bought by Profile Capital Management in 2020. Since then, it has been rejuvenated and is growing its business, with a new CEO appointed in January 2024. Panzura acquired Moonwalk Universal for its hybrid cloud unstructured data estate scanning, migration, and tiering technology in July last year.
Nasuni also went into private equity ownership that month with a majority investment led by Vista Equity, in partnership with KKR and TCV, valuing the company at $1.2 billion. It looks like the three spread the risk.
CTERA took in $80 million in primary and secondary funding from PSG Equity, also in July 2024. The cash is set to be used for taking advantage of AI opportunities and growing CTERA by acquiring other businesses.
Now Egnyte has opened the door to private equity as well. TA says it’s focused on scaling growth in profitable companies. GI is an Egnyte customer.
Following GI and TA’s investment, we’re told Egnyte’s founders, management team, and existing investors – including funds and accounts managed by Springcoast, GV, Polaris, and Kleiner Perkins – will retain significant ownership in Egnyte. Financial terms of the transaction were not disclosed. Qatalyst Partners served as financial advisor.
