SpiderOak: The Online Backup and Sharing Service Where Privacy Counts

8/29/12Follow @wroush

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run in smartphone and tablet browsers, and might even replace the company’s existing downloadable client program for Macs, Windows machines, and Linux machines.

As a result of its privacy focus, the company also falls a bit short when it comes to collaboration. In the consumer version of the service, users can give family members or friends access to specific folders within their accounts by sending them a special password for that folder only. But that approach wouldn’t work across an organization, so Fairless developed a “collaboration virtual machine” that sits behind a company firewall and has access to plaintext versions of files in multiple accounts. The virtual machine encrypts all data before sending it to SpiderOak, so the company maintains its zero-knowledge policy.

Alan Fairless, co-founder of SpiderOak

Alan Fairless, co-founder of SpiderOak

The company also sells a private-cloud version of its entire software stack, for corporate customers who want to handle their own storage. Licenses cost $5 per user per month, and it’s nearly all profit, since the company doesn’t have to invest in infrastructure for these accounts.

SpiderOak has “enough revenue coming in that we can self-fund and we don’t need to raise money,” Oberman says. But with the possible exception of Dropbox, there isn’t a company in the online storage and synchronization market that has gotten really big without dropping a lot of money on marketing—so no one would blame Spider Oak for exchanging a little bit of control for a little bit of capital.

After all, as Oberman himself points out, “we’re the only major company competing in this space that has raised less than $70 milion.” That’s a good place to be in—unless it limits your options. Whatever happens, look for SpiderOak to do the unexpected.

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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