Key Microsoft SaaS Partner AvePoint Plans $2 Billion IPO via SPAC

… $148 billion will be 26% higher than last year’s $117 million.

CollabTalk’s Christian Buckley

“AvePoint was very smart was during the early years of Microsoft’s push toward the software-as-a-service model,” said Christian Buckley, whose CollabTalk provides research and technical marketing services. “They recognized this shift toward the cloud early on, and while it would take years for most ISV partners to recoup any of these investments, that early insight and strategy is paying off immensely for AvePoint today.”

During its 19-year history, AvePoint’s customers have consisted of the largest enterprises, which comprised the majority of SharePoint shops. As Microsoft built Office 365 and OneDrive for Business on the core SharePoint repository and data store, AvePoint’s market expanded. AvePoint now offers data protection and governance for Microsoft Teams and Office 365. As AvePoint shifted to SaaS, it paved the way for last year’s expansion into small and midsize enterprises.

“We realized, ‘Hey, just because you’re a 50-person law firm doesn’t mean your data is worth less to you than American Express or Citibank,” Jiang said. “That’s now our customer.”

Meanwhile, the company started offering SMBs monthly subscriptions.

Expanding from Direct Sales to Channel

Because of its large enterprise heritage, more than 70% of AvePoint’s customers buy directly from the company. AvePoint’s enterprise customers sign multiyear contracts, typically from one to three years. With last year’s foray into the SMB market, AvePoint started offering monthly subscriptions through MSPs.

“Wouldn’t you know it, the logo retention rate last year is 99% and this year even during COVID-19, it is 95%,” Jiang said.

Among the key reasons AvePoint wanted to go public was to expand its reach into smaller companies.

“The best way to capture that market share is channel; it’s scaling through indirect sales,” Jiang said during Monday’s webcast. “SMB is 100% channel to distribution partners and selling to MSPs.”

AvePoint kicked off that effort last year, with the launch of Elements, a platform that lets MSPs offer migration, backup and management of Office 365 and Azure tenants.

“But obviously, to go after the SMB, to play in the same playground as Veeam, Datto and companies like that, we really need to step it up,” Jiang said.

Buckley said AvePoint is making the right moves.

“They have been making solid inroads into the MSP space, and now find themselves in a dominant position within the M365 ecosystem,” he said. “In some ways, the cloud ecosystem is more crowded with smaller, purpose-built apps and narrowly focused ISV solutions, but few companies have the depth of expertise and comprehensive offerings to compete with AvePoint in the Microsoft 365 cloud ecosystem.”