Backblaze has big plans involving big companies.
Backblaze co-founder and CEO Gleb Budman told IT Brew that the almost 18-year-old cloud storage and data backup company has entered a new era in its business that he calls the “enterprise” chapter. Since going public in November 2021, the company has set out to move more upmarket.
“Internally, this is about us becoming…a significant organization of scale,” Budman said. “And externally, I think that this is the enterprise chapter…we’re moving upmarket and serving more and more larger organizations with all their needs.”
Backblaze has been making progress on this mission, indicated by CFO Marc Suidan on the company’s Q4 2024 earnings call, who said the company had been seeing some “momentum” on this strategy. Budman told us part of this progress comes as the company catches the attention of companies looking for a flexible AI tech stack.
“If you look at Google, Microsoft, Amazon, what they’re doing is spending billions and billions on capex, buying all these chips, and then trying to lock you into their ecosystem and just using their set of chips,” Budman said. “What Backblaze is doing is saying, ‘We’re going to provide the storage layer and not spend all this crazy capex on GPUs, and instead, we’re going to free companies to use [whichever] GPU clouds they want.’”
He added that the Backblaze B2 cloud storage is one-fifth of the price of equivalent offerings from the three major cloud storage hyperscalers, an additional perk.
“We’re dramatically less expensive, and if you have a lot of AI data, which companies do, then they are often able to save significantly on all that cost,” he said.
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Feasible or moonshot? Aviram Levy, senior director and tech evangelist at Zesty, a cloud infrastructure optimization platform, told IT Brew that Backblaze is a “compelling” option for organizations that have object storage as their main expense. However, he argued that for organizations with workloads already in AWS, it may not be as attractive to add another vendor.
“What happens if there is a connectivity issue?” Levy, a former AWS technical account manager, said. “With AWS, if I have [an] issue, I open a case to AWS. I am a customer. Now, I need to open a case to AWS and to Backblaze. This is double work.”
Levy said that in order for Backblaze to increase its market share, it would need to provide meaningful value to customers beyond its object storage (the company’s stock value fell almost 50% in the past year).
“If they want to go up in the chain to larger companies [and] enterprises, they will have to solve a very unique problem,” he said.
Garima Kapoor, co-CEO and co-founder of object storage system company MinIO, told IT Brew that it is a “winner-takes-all market” and that companies looking to lure larger customers should continue to scale and gain the trust of the industry.
The little things. In the meantime, Levy told IT Brew that there is nothing wrong with staying small. He said that downmarket is still a lucrative space for companies like Backblaze to target.
“The price for these small customers is compelling and the addressable market is large,” he said.