Tech

Octave Klaba wants to build European cloud-computing champion

Octave Klaba, the founder of OVHcloud, arrived in a court in Paris earlier this year to bid on a promising tech starter that went bankrupt, but rival bidder Xavier Niel, France’s most famous tech billionaire. I bumped into.

“He’s a shark that can find good business opportunities, and so does I,” Clava said, recalling how he outperformed technology founder Neil. Incubator station F With serial investors Startup, For the cloud gaming service Shadow.

Unlike Neil, the 46-year-old Polish-born entrepreneur has been relatively unobtrusive so far. But this week, cloud computing company OVHcloud, which he founded in the industrial city of Roubaix in northern France, will open trading on the Paris Stock Exchange.

The group aims to raise € 350 million by selling new shares at an IPO valuation of € 3.5 billion to € 3.75 billion, with Clava and his family still 78% of the shares. Owns.

Even after they sell slices on an IPO, if the stock price is at the lower end of the range, about 70% of their shares are worth € 2.5 billion and will be part of Europe’s wealthiest tech entrepreneurs. ..

“It’s hard to believe that a bootstrapped Roubaix company without venture funding can compete with American tech giants,” Clava said. “IPOs help convince suspicious people that this is actually happening and that they should participate.”

Founded in 1999 as a website hosting company, OVHcloud currently employs 2,200 people and provides computing, storage, and networking services primarily to clients in Europe and the United States. A large fire at the Strasbourg data center earlier this year slowed growth and incurred additional costs, yet with annual sales of € 663 million and operating profit of around € 230 million. I am aiming.

Octave is the chairman, and his father Henryk and his brother Miroslaw are both engineers, working as responsible for networking and R & D, respectively, and members of the board of directors.

IPOs are an important moment for the French tech ecosystem, steadily spawning billion-dollar start-ups, but few public listings in Paris.Before digital music company Believe goes public Earlier this year, France-based tech companies hadn’t been listed on more than $ 1 billion since the online advertising group Criteo went public on the Nasdaq in 2013.

Meanwhile, some French founders have moved to the United States to expand their company, leading to the following blockbuster IPOs: DataDog 2019 and Snowflake In 2020.

Clava, who is married to her three daughters, does not seem to be very interested in the outward trap of wealth. His office outfit consists of a T-shirt and sneakers with the OVH logo. “I was born in communist Poland, where there was nothing, so you learn to get it done in just a little bit,” he said.

OVHcloud employs 2,200 people and provides computing, storage and networking services primarily to clients in Europe and the United States © François Lafite / OVHcloud

Instead, he spends money on expanding the company, playing the guitar, and more recently investing in other start-ups and establishing new wind turbine manufacturers.Serious battle with cancer About 10 years ago, he realized his priorities and realized that OVHcloud needed to be structured and strengthened to live longer than he did.

Clava’s grandfather was a miner in northern France after World War I, but returned to Poland in 1949. However, his grandfather’s French citizenship allowed his family to immigrate to France when Clava and his brother were teenagers.

“We said [our parents] I wanted to go, “Klava said. “Since then, I have considered it my role to keep my family from becoming poor in France. To take care of everyone.”

When the family arrived in Lube, Clava didn’t speak much French, but was interested in the servers that underpin the Internet and networks at the engineering school in Lille.

As a hobby, he would create an OVH (name stands for “on voushéberge”, French for “we host you”) that stores and manipulates client web pages. As the company grew, the whole family joined the business. Klaba’s father helped invent OVH’s in-house server technology, which was key to the low-cost model, because it used water instead of the more expensive air conditioner to cool the processor. His mother was in charge of finance and administration.

The family did not invest until 2016, when it sold its 20% stake to private equity funds KKR and Towerbrook for € 250 million.

“What I’m trying to prove at OVH is that there is another more European model that puts entrepreneurs and families at the center of the ecosystem,” Klaba said, avoiding venture capital and more than the United States. Mentioned how to slowly expand. Start-up. “In our case, entrepreneurs maintain control rather than being at the mercy of investors and financial pressure.”

Clava got help from Neil early on. Neil rented space for a building he owns in Paris to a young entrepreneur for a bank of growing servers. Clava was so devoted that one night Neil remembered that he was sleeping next to his equipment.

“Given the story of his unusual life, what he did is impressive,” Neil said. “He came out of nowhere to set up a great company to become a European leader in cloud computing.”

Today, OVHcloud is trying to open up the market for so-called public cloud computing services. The service is growing at about 25% annually and is dominated by US players such as Google, Amazon and Microsoft.

So far, there is not enough scale and economic influence to compete directly in this segment. It is estimated that Europe has a market share of 1%, compared to 66% of the US group.

However, it is even stronger in a “private cloud service” where devices such as servers are not shared like a public cloud, but are used exclusively by a single company or organization. OVH estimates that the market has annual sales of € 8 to € 13 billion worldwide and is growing at 15 to 20 percent per year. In Europe, it is estimated to hold about 10-15% market share, comparable to its major competitor IBM Cloud.

OVHcloud also earns a quarter of its revenue from web hosting, which holds a leading position in Europe.

Many politicians in Paris and Brussels are concerned that Europe’s sovereignty and economic competitiveness could be compromised if businesses and governments were forced to rely solely on U.S. cloud providers. Therefore, we support the success of OVHcloud.

Klaba takes advantage of these concerns to advocate OVH as a safer alternative, as servers outside the United States are not subject to search warrants from US law enforcement and intelligence agencies. Some experts and lawyers have questioned that claim.

“OVHcloud is the only European company that could resist the rule of the US tech giant,” said Cedric O, Deputy Secretary of Digital Affairs in France. “It’s a very important actor in European technology, and it tells us that Octave built it himself without any help.”



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