News

posted on 25 July 2008 10:29

Risc Group, a French online backup service company, has taken a risk (!) and bought a UK online backup service company, Clunk Click.

Clunk Click offers online backup for VSE (very small enterprises) and SME's (small/medium enterprises) servers and desktops (Windows, Mac) and mobiles. It also offers onsite storage arrays. Risc Group offers outsourced IT services to the estimated 1.6 million VSE and SME businesses in Europe. It wanted to enter the UK market and decided to acquire Clunk Click because it had a good product, a useful existing customer base and sales channel.

Loïc Pequignot, Chairman of Risc Group, said:"After a detailed study of the British market, we deemed that it was more relevant to attack this already mature market via acquisition rather than the launch of a new subsidiary, as in Spain or in Switzerland. To this end, as the British market is made up of many medium-sized companies, Clunk Click quickly emerged as the ideal structure, due to its positioning and approach to market, as well as the professional qualities and skills of its team."

Risc Group acquired 100 percent of Clunk Click for £2.5m, paid in cash. Price premiums totalling £1.3m may be paid depending on the business achieved and the operating result obtained over the coming 24 months. Paul Roberts, and his 11-strong team will join the Risc Group workforce and contribute to its development on British soil.

Clunk Click was founded in 2001 by Paul Roberts, its majority shareholder and Managing Director, targeting VSEs and SMEs. The company has developed through a value-added offering that, has ensured high recurring revenue from its 3,000 customers. It is based in Conwy, Wales, with an office in Milton Keynes and data centers in Manchester (England).

The customers were gained half through a reseller channel, with more than 100 members, and half through a direct sales model. It hopes to expand its reseller channel to the 200 mark by the end of the year.

Over the 2007-2008 financial year Clunk Click recorded a turnover of €1.1m with an operating profit of 9 percent. For the current financial year, the objective is €2-2.4m.

Commentary

Already then we are seeing the early signs of consolidation in the online backup market. Clunk Click is one of a number of online backup service and online storage service suppliers that we have mentioned recently, such as:-

- Amazon's S3 cloud storage service,
- EMC's Mozy,
- Seagate's Evault,
- Carbonite,
- Google,
- IASO in Holland,
- IBM's Arsenal,
- Iron Mountain's Live Vault
- Nirvanix' cloud storage service
- SquirrelSave (UK-specific),
- MemoPal - based in Italy but expanding outside,
- Steek in France,
- Spare Backup,
- Symantec SwapDrive.

(Not forgetting Microsoft's Red Dog development effort either.) We're grouping online storage service vendors with online backup service vendors its unlikely that a customer using an online stirage service will have a separate online backup service. They'll rely on their cloud storage service provider to protect the data.

This is a rapidly developing and maturing market in which we can expect data center scalability and reliability to be a key component along with marketing spend. Early sub-region and regional suppliers can be expected to rapidly partner and consolidate to build up critical and sustainable mass as the online backup service cloud grab proceeds apace. They'll need to do that to compete with global concerns like EMC and Seagate, Google, Amazon and Microsoft, that are intent on making progress in the market too.

^{[Chris Mellor.]}