WordPress, microservices, and DevOps are all technology areas poised for growth, and with the help of Oakley Capital, software platform Plesk is ready to help its partners innovate in these emerging areas.
“We want to drive more innovation and make Plesk a more complete solution so that our partners can push more sophisticated solutions into the market,” Plesk CEO Nils Hueneke said. “We really want to widen the use-cases far beyond simple web hosting.”
Plesk announced that Oakley Capital had acquired the company for $105 million. Control panel platform Plesk is one of the businesses that spun out of Parallels two years ago, along with Odin, the automation and billing business, which was sold to Ingram Micro in 2015, and Virtuozzo, which also operates separately.
Indeed, the web hosting market has changed a lot since 1999 when Parallels first launched, and the company has been through many renditions since then. In the first years the business was focused on growth in the European market, and over time Parallels as a company focused on its automation solution, Hueneke said.
In 2015, the process began to separate the three businesses, and Plesk began to operate as an independent company, which involved setting up its own accounting and marketing teams. “Having these dedicated teams helped rebuild the brand,” he said.
While it used to compete in the traditional control panel space, its expanded focus will insulate it from the decline it sees in shared hosting.
“When you look at the shared hosting market it is pretty much being eaten by Weebly, Wix.com,” Lukas Hertig, VP marketing and alliances for Plesk says. “Over 80 percent of [Plesk’s] install base is actually VPS hosting, meaning you have a smaller number of websites and applications running on a per server basis, which allows us to move up the food chain easier into the hyperscale, DevOps world as well as into the microservices world.”
Hertig added, “Based on our own research, the hassle of deploying these DevOps frameworks is huge for developers and the worst case scenario that we hear is some people who develop apps [put] the same amount of effort to deploy the programming framework than the development of the app itself. This is where we jump in. Wherever you run your app or website, wherever you run Plesk we will be your tool that you build secure and run your website or application.”
Despite these broad ambitions, Plesk has no plans to abandon its service provider partners.
“We still want to [support the]2,500 service provider partners that we have today…but we obviously see that the traditional web hosting market is not growing as fast anymore, and while we see there is a lot of growth in the hyperscale cloud…there is a lot of value and growth in managed services and solution building,” Hueneke said.
Hertig says that a lot of hosting providers are sitting in a comfort zone where they are not willing to change with the market.
“When you move up the food chain away from product selling into solution selling I think there is an opportunity for hosting providers,” he said, citing MediaTemple, SingleHop and smaller providers like Germany’s Dogado as examples of success stories.
The challenge for many hosting providers making this transition into solutions sales is the level of understanding they must have of their customers.
“You need to understand your customer and your specific vertical much more because you want to provide business outcomes, not product outcomes,” he said. Successful service providers are not just moving workloads to Amazon Web Services (AWS), “they are finding new customers and new revenue opportunities together with managed services.”
Plesk began talked to Oakley Capital last summer, even though they were familiar with the company through its other acquisitions in the hosting space.
“There were lots of signals in the market that Parallels wanted to create three independent businesses,” Huenke said. “Due to this knowledge in the market Oakley had the most confidence in us so we really came together.”
Hueneke said that the investment structure may help Plesk add more functionality, perhaps through acquisitions, “but it’s still early.”
“Previously we always had APS that was a fundamental piece of our automation platform, all our partnerships we were driving were mostly for driving automation, not for Plesk, and we are going to change that,” Hueneke said. “We already changed that over the last 12 months, we are going to partner with those parties that help Plesk become a better product.”
Hertig said, “In the early days it was a lot of partnering with Microsoft, today we really partner with the industry leaders in that space to actually make sure we are following the future growth.”
“At the end of the day we have our portfolio ready that you can more or less manage all aspects of your server from Plesk,” he said.