Congrats to Backupify! A Great Exit Story for the First Company I Ever Backed

Today, Backupify announced that it is getting purchased by Datto.  It's a solid exit to a company that has lots of revs, is growing, and together will form a very formidable player in the data backup space--one that can definitely be a public company in the next couple of years.  

I'm super proud of Rob, Ben and the whole Backupify team--and this is particularly special for me because Backupify was the first investment I ever made as a VC, and the first board I ever sat on.  

In fact, my history with Rob and Backupify goes back almost ten years, well before the idea of cloud backup was ever a glimmer in anyone's eye.

I started reading a great blog called Business Pundit in 2004.  It was written by a guy about my age down in Louisville, Kentucky.  A former engineer, Rob was a great writer and a thoughtful student of management.  I don't remember when I started talking to Rob, but I know it was before February of 2005, because I found "rob@businesspundit.com" in the contacts I ported over when I left GM and went to USV.  

We used to chat a fair amount via our respective blogs about management and entrepreneurship.  He was an interesting guy and I watched him throughout a bunch of interesting projects, like a complete open source business where all the employees got to make the decisions.  

I didn't actually get to meet him in person until SXSW in 2007.  That was the year Twitter took off.  

I took this picture of Rob, Michael Galpert, and Danny Wen of Harvest.  Even then, Rob was an optimizer, trying to map the best routes around Austin.  

I liked meeting Rob so much that when I drove across the country that summer, I made it a point to go visit him.  

We stayed in touch and I got to know a bunch of the Louisville startup and creative crew, like Todd Earwood, Matt Winn, and Ashley Cecil.  

Rob messed around with some local video thing in 2008, which everyone but Rob thought was a pretty terrible idea.  Later that year, I sent a tweet that inspired a company that initially only Rob thought was a pretty terrible idea:

Still, he got his guys in the Ukraine to code something up.  On January 6th, just 9 days later, I got an e-mail from Rob:

"Flickr backup is now working.  We will integrate the design and be live for testing end of next week. I will keep you posted."

And keep me posted he did.  "Lifestream Backup" became Backupify and the service started gaining traction--just as the company that I started was losing traction.  Right around the time that Rob finally got convinced that Backupify was a good idea and needed some more resources, I wound up on the doorstep of First Round.  Less than 100 days into joining FRC after winding down my startup, I offered my friend Rob the first term sheet I ever sent out--to lead the seed round of the company I accidentally inspired with a Tweet.

We got the round done with some great names around the table--Jason Calacanis, Chris Sacca, and General Catalyst.  I joined the board and I was assuming everything would always be up and to the right, because that's the way success happens, right?

Well, it turned out the company was probably too early to the market--and while that gave them a lot of time to create the best technology, customer traction wasn't happening nearly as fast as we were spending money on AWS.  

Fundraising for the Series A looked like it was going to be difficult--and that's when Rich Levendov from Avalon Ventures stepped in.  He met Rob at a conference, took a liking to him and saw the same vision on where the space was going.  He took a long term view and jumped in with a check.  He was also there for the company in a big way during what would have otherwise been some bleak follow on rounds.  I thank Rich and his team, as well as David Orfao from GC for their support of my good friend long after I left First Round.  

I'm excited for the company's next steps.  In his note to users, Rob talked of a good future for their combined effort:

"In most acquisitions, technology gets neglected, falls behind, or worse, gets shut down. None of that will happen here. Datto is an R&D company at heart, and the plan is to double the size of the Backupify engineering team, and accelerate our vision of supporting all your cloud apps. We are working toward a joint vision of building the world’s only comprehensive data protection platform, to protect all of your business data, no matter where it lives, and available in seconds when things go awry, to keep your business running."

I'm proud of the whole team at Backupify and have been really impressed with Rob's ability to grow and learn as an entrepreneur over time.  

Plus, I'm glad he sold now, so maybe he can jump in as an investor in my next fund just like Wiley Cerilli did after he sold Singleplatform.  Maybe I should be writing that into my term sheets from now on:  "If this crazy thing works, you have to invest in the next fund after you exit."