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Mimecast co-founder Peter Bauer on running a UK unicorn and taking it public

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It’s not uncommon for people to complain about the hundreds of emails landing in their already crowded inboxes on a daily basis (I am one of them!). But these are not just an unsolicited addition to employees’ workload, they can also pose a significant security threat to businesses.

Peter Bauer, CEO and co-founder of cloud-based email management firm Mimecast, is trying to put an end to this. Founded in 2003, and with over $89m in funding secured, Mimecast employs approximately 800 people in offices across the globe and claims to serve just under 22,000 customers.

A publicly listed company since it IPO’ed on New York’s infamous Nasdaq exchange little over a year ago, Mimecast has come a long way since its humble beginnings in the early 2000s.

Ed Molyneux, co-founder of FreeAgent, on taking your company public and learning from your mistakes

“The founding idea was based on the premise that IT was going to move on to the cloud and benefit from the tremendous efficiency that comes with sharing infrastructure,” Bauer told Tech City News, noting that despite this not sounding particularly visionary or revolutionary, it was considered a somewhat controversial move at the time.

The numbers

Having reached a valuation of $1bn in just over a decade, it seems Bauer and his co-founder Neil Murray’s instincts paid off.

With 145 billion emails under management, Mimecast’s Q2 2016 earnings (released in November) revealed the firm had reached a total revenue of $44.4m – representing a year-on-year growth of 29%.

The numbers seem positive, but what does it take to build a successful business and, most importantly, ensure that it remains so?

“You can probably give a monkey $100m of other people’s money and they can grow a company in a decade,” said Bauer, “but we feel we’ve been quite capital efficient. The company’s market cap is about $1.2bn, so we feel we’ve done a good job of creating value relative to the the capital invested.”

Going public

Bauer decided to take his company public, but he concedes this is not a viable possibility for everyone and it’s certainly not a decision he took lightly.

“Not every company can go public, public markets cannot support any kind of business model,” he said, adding that in Mimecast’s case the decision to list on Nasdaq was about retaining control.

“For us, going public was a great opportunity to re-establish our independence … but doing so is a real commitment,” he explained.

With this in mind, Bauer said entrepreneurs should think carefully about whether they want to take their companies public and also consider which of the markets would be suitable.

Before listing, Bauer thought long and hard about going public in the UK, eventually settling for Nasdaq in the US because the visibility and publicity that this would give Mimecast was far greater.

“Admittedly, a lot of our customers are also in the US,” he noted.

Company culture

Regardless of whether you go public or not, one of the things Bauer believes founders should keep a tight grip on is culture as this will gain increasing significance as a business starts to grow.

“Be clear on your values, what you expect and what you want to achieve as a workplace,” he commented, noting it is important for entrepreneurs to learn from their mistakes and to quickly rectify them.

Get company culture right, but don’t get totally obsessed with it, he said, as doing so can cause the health of the organisation to fail.

“It all becomes rather inward looking and it is a huge danger to success,” concluded the co-founder.

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