From: mergermarket.com, a Financial Times Group publication

IASO Backup Technology in talks with VC firms over financing market expansion; company open to offers, CEO says.

IASO Backup Technology (IASO) is in talks with venture capital firms to raise EUR 2m, co-founder and Chief Executive Officer Rob Verbeek said. IASO is a privately held Dutch company focused on fast safe and reliable IP-based/online back-up solutions.

The funds will mainly finance the strengthening of IASO’s distribution network and the entry into new markets, Verbeek explained. “Our product is ready and our focus is now on marketing and selling it,” he commented. Western Europe - mainly the UK, the German-speaking countries, Scandinavia and France - are the most attractive expansion markets at the moment, he said, adding that Italy and Spain represent a second priority. He pointed out that IASO’s product needs a mature IT infrastructure market.

The CEO said that the company would like to close the funding round by June 2010. He mentioned that they could consider using a limited part of the funds to buy out some investors; but commented that, however, at the moment none of the current shareholders are actively looking to sell their stakes.

An additional round of between EUR 3m and EUR 5m will be required in 18 to 24 months, the CEO said, explaining that the money will finance the company's market expansion in Asia and the US.

A trade sale it is always an option: “We did not build the company with an exit in mind, but we are open to it and keep our eyes open,” he said. As potential buyers, he suggested security companies or storage computer companies. At the moment, 77% of IASO Backup Technology is in the hand of the four founders, and the remaining 23% is held by Technofonds Flevoland.

Verbeek mentioned that the valuation of the last acquisition in IASO’s market segment was based on a turnover multiple of 11x and added that in last few years, transactions in the sector were based on average turnover multiples between 6x to 15x.

IASO was founded in 2004 and has been generating revenues since 2005, reaching the operating break even in 2006. The company’s forecasts indicate a turnover of EUR 12m to be reached with 70 employees in 2012, Verbeek said. IASO is a leading European developer and vendor of IP-based backup software and services. The company offers several solutions based on a single technology platform, which can address different market segments from SMBs to corporate clients. IASO currently has a market share of 55% in the Netherlands and aims to become the market leader as well in those other countries where it is/will be present, Verbeek said. He added that partnerships with (for example) major telecommunications companies and ISP customers companies are part of IASO’s strategy.

By: Laura Larghi