Every year, more and more entrepreneurs seem to recognise Amsterdam’s potential as a hub for innovation. The thriving startup ecosystem of Amsterdam has attracted many international startups to set up their European headquarters in the city.
Silicon Valley-based Splashtop recently joined the list of international startups that chose Amsterdam as their European HQs. The startup also announced today that it has closed a $50M (nearly €41.3m)financing round that pushes its valuation beyond the $1B (approx €0.83B) unicorn level. The round was led by existing investor Sapphire Ventures, with participation by other long-time Splashtop investors Storm Ventures, NEA and DFJ DragonFund.
“The newest funding comes a decade after Splashtop’s previous funding: four rounds that raised a total of $49M (approx €40.4M),” says the company in a press release.
Making a Splash amid COVID
Splashtop claims to be an emerging leader in next-generation remote access and remote support. It delivers remote access and remote support software and services for enterprises, academic and research institutions, government agencies, small businesses, MSPs, IT departments and individuals.
According to the company, “the COVID-19 pandemic—which shut down physical access to corporate and academic computing resources worldwide—drove increased demand and appreciation for Splashtop’s solutions, including among larger enterprises.”
“Our sustained profitability and growth—which accelerated during the COVID-19 pandemic—validate that Splashtop’s modern approach to remote access is making a real difference in how, where and when people can use the digital resources they need to work, learn and be entertained,” says Mark Lee, co-founder, and CEO of Splashtop.
“We’re fundraising now at unicorn valuation to amplify our brand and momentum so we can attract talent, expand our enterprise presence, and accelerate our global expansion to delight customers everywhere,” he adds.
Splashtop’s unicorn status is validated by the fact that it has been profitable since 2015 even while growing rapidly. It claims that its current growth rate of 160 per cent and profits of 60 per cent represent exceptional performance levels.
“Also fueling Splashtop’s valuation is recognition of the company’s vision for disrupting the established remote access market,” says the company.
“In the investment world, the Rule of 40 is a way to evaluate the investment prospects of software companies. If the sum of revenue growth and profit margin equals or exceeds 40, the company is deemed a potentially healthy investment,” Lee mentions in an official blog post.
“Splashtop has a growth rate of 160 per cent and profits of 60 per cent—for a total of 220. That’s more than 5X the Rule of 40! And we’ve been profitable since 2015, so this isn’t some flash-in-the-pan recent development. Achieving a Rule of 200+ really sets us apart among companies reaching unicorn status. We’re proud that we’ve pursued this path, because it bodes well for our long-term business health,” he avers.
The ripples reach Europe
In 2020, Splashtop opened its EMEA headquarters in Amsterdam and expanded its Euro currency and local multilingual support.
In an exclusive conversation with Silicon Canals, Alexander Draaijer, general manager EMEA of Splashtop, shares the reason behind choosing Amsterdam as its EMEA HQs. “Splashtop has picked Amsterdam due to the fact it’s been recognized as the European capital of innovation while the Netherlands is being perceived as the west coast of Europe. Starting our European HQ in Amsterdam, we can attract a lot of multilingual talent that allows us to hit our growth objectives, but more importantly to support our customers in their native language,” he says.
“Obviously, Amsterdam is easily accessible to people around the world and allows us to easily travel efficiently when needed,” he adds.
According to the company, it has recruited 7 people in its first year of it European presence and plans to hire more once it opens its brand new office at the Piet Heinkade in Amsterdam on the 1st of February 2021.
“This year, we would like to grow over 200 per cent. That means we are looking to hire roughly 10 people in the first quarter of this year with roles varying from customer success, sales, support, and marketing, to channel managers, so we can support and enable key partners across our EMEA markets that can help us scale. I wouldn’t be surprised if we would finish 2021 with 30 people in our new office,” Draaijer says.
In 2020, It also achieved SOC 2/SOC 3 security auditing compliance and became ready to comply with Europe’s General Data Protection Regulations (GDPR).
Draaijer tells Silicon Canals that customer-centricity is a big part of Splashtop’s culture. To illustrate the customer-centric attitude, Draaijer says Splashtop even gave away free licenses to keep struggling businesses afloat, in areas hit hardest by the worldwide pandemic.
Recently, Splashtop introduced volume discounts to help the remote working effort and to support business continuity in these challenging times.
“One user costs € 90,- a year. We offer a 20 per cent discount for any user over four, 45 per cent discount for any user over 10, and 50 per cent for any user over 50. And we don’t remove the discount when people renew their subscriptions – this is for life,” he adds.
According to him, even though Splashtop is relatively new to Amsterdam and Europe, it already managed to attract a strong portfolio of customers, with about one thousand paying customers in the Netherlands alone, including NEP Hilversum, healthcare centres like Het Slingeland Ziekenhuis, educational institutions like Leiden University of Applied Sciences and a host of Managed Service Providers.
“Educational institutions in Europe and Africa are very much our target. We recently signed up many large innovative educational institutions like the Royal College of Art in London and the University of Westminster, both in the UK, but also the IED European Institute of Design in Italy, the Robert Schumann University in Germany and many more.”
Africa and the Middle-East to follow
According to Draaijer, after focusing on the European market from the Amsterdam headquarters, Splashtop will set its focus on Africa and the Middle-East. During 2020, Splashtop expanded its global reach, including new partnerships in EMEA, South America, and Asia.