November 11, 2021
3 min read

To the Clouds and Beyond — Fueled by $90 Million in Growth Capital from Goldman Sachs

Today, we stand on the cusp of an inflection point in WSO2’s journey. I am thrilled to announce that we have secured $90 million in financing from Goldman Sachs. This new investment means our original vision continues to have an enduring purpose, and we could not be more excited to be backed by such a strong institution.

We have a lot planned with this newest funding. It will be used to roll out our next-generation, cloud-native solutions for securely delivering APIs, applications, and digital identities (Choreo and Asgardeo); further invest in our core open-source products for API management (WSO2 API Manager) and customer identity and access management (WSO2 Identity Server); accelerate our worldwide business expansion; and grow the company’s global partner and support network. In addition to supporting our commercial offerings, we will also invest in extending the capabilities and community around Ballerina, the open-source language that radically simplifies how developers build and deploy cloud-native applications.

Where We’ve Been …

Our story began 16 years ago with a bold goal: to build the world’s best open-source software company based out of Sri Lanka. When we started, we saw the technology change around Web Services offered an opportunity to reinvent middleware, and that legacy players could be replaced by using a better approach. We committed to a 100% open-source business model, which many believed would not work (for context, most open-source companies have switched to open core; we have not done that). But why not go all in, right?

In hindsight, even with our lofty goals, we could not have possibly predicted our growth trajectory. I remember how our first customer paid us through PayPal, with no contract. Fast forward to today, we now have 800+ customers in 85 countries and help some of the world’s largest corporations, top universities, and governments. The journey has truly been a humbling experience.

From a Sri Lankan perspective, we are easily the country’s largest software company, employing more than 800 people there. Sri Lanka has anchored our growth and driven every part of the business for a long time. Today, however, we are a truly global business with more than 50 people in the US (and growing fast) and rapidly expanding teams in the UK, Brazil, Australia, Germany, Dubai, and India. Our leadership team is now fully global, and we work closely as one entity distributed across many time zones (which makes it fun to have calls because someone has to be up at 1 am!).

Thanks to the sustained technology value we deliver to our customers, WSO2 has been cash flow positive since 2017 and profitable since 2019. We have grown the business using our own cash over the past several years. In 2021, we expect revenue to grow 30-35%, closing the year at around $65 million in ARR. We plan to hit $100 million in 2022 — which means while it took us 15 years to get to the first $50 million, we will get the next $50 million in two! The company has rapidly grown from 550 to nearly 900 employees in less than two years; hired several key senior leaders; added 65-plus channel partners across the Americas, EMEA, and APAC regions in the past year; and seen an 80% increase in original equipment manufacturing (OEM) partners. 

...And Where We’re Going

The pandemic has accelerated enterprise digital transformation by years and more employees are contributing to software development and delivery. To offer new digital products and services, companies now need solutions that democratize the adoption of API management, integration, and CIAM technologies. We see demand for more robust low-code approaches to not only improve employee productivity but also create trusted, engaging customer experiences.

We are addressing these challenges with our Choreo integration platform as a service (iPaaS) and Asgardeo identity as a service (iDaaS) solutions, both of which significantly lower the skills, time, and cost barriers to delivering new and secure digital experiences. Moreover, Ballerina, our ground-breaking programming language, has the potential to become an industry standard for creating next-generation, cloud-native applications. Our priority is to ensure that our investments in these technologies will continue to empower professionals and enterprises to realize real value, and we will accelerate this endeavor through the funding.

Our future lies in building cloud-native software, and this is where we are heading. This will help realize our vision of creating a better world with software that works together in a secured manner.

To survive and thrive over a long period, software companies must evolve in radical steps, not just in incremental movements. The funding from Goldman Sachs allows us to quickly realize our vision for WSO2 to become a cloud-first company. We are thankful for the firm’s belief in us.

I also want to thank our customers, partners, and other investors for their continued trust and commitment in helping us build industry-leading products that improve the lives of millions. We sincerely appreciate the role they have played in our journey.

Last but never the least, I want to thank the WSO2 team and their families. From the outset, the company’s driving force has always been the quality of our people. We could not have come this far without your hard work, dedication, and support. This funding demonstrates the confidence our investors have not just in our products, but also in all of you — who I know remain obsessed about building our vision. It has been a privilege to lead the greatest talent in the business.

I have always said that all of us at WSO2 care about the journey and not the destination. The path we have been on for the past 16 years has been incredible — and we are still on the road.