From Hard Core Techie to Successful Entrepreneur: Francis Dinha, CEO of OpenVPN (Part 4)

Sramana Mitra: You were doing a hosted product until recently.

Francis Dinha: Yes. Even Bloomberg came to us. They said, “What about if we license your software? We pay you half a million dollars one time.” I said no. Our model is subscription. Google was our customer for three years. They used our self-hosted solution. Then they wanted to have so many features. I said, “You can take our open source and build on your own.” They did that.

Sramana Mitra: That’s a very good point – saying no to certain opportunities. It’s an important part of building a business. You have to stick to your vision.

Francis Dinha: Believe me, so many people came to me. They want to take our software and white label. You are now relying on somebody to take our software, brand it, and become successful. Now we have NetGear. They want to use our cloud. They want to brand it under their name. I am not convinced about that model. Stick to your model.

Sramana Mitra: What was the competitive situation?

Francis Dinha: It’s more F5 – the hardware-based. Our distribution was Linux. You can download it, and build your VPN. Because it was open-source, a lot of routers were incorporating OpenVPN into their engine. That helped us tremendously. Even AWS came. They wanted to have our access server in their marketplace. They were going to do the advertising. At the same time, they were going to build something to compete with it. They took OpenVPN and they compete.

Oracle is another example. They wanted to white label. The product manager didn’t like my idea. For two or three years, they’ve been developing themselves. Now in their marketplace, they say download OpenVPN access server. It’s another story to take something to the marketplace and make it usable.

Sramana Mitra: I like this model of having something out there as an open-source product and building around that. It’s a wonderful model, especially for entrepreneurs who come from a technical background. You have built a $30 million ARR at this point.

Francis Dinha: It’s more $3 million MRR.

Sramana Mitra: You just had a million seed round.

Francis Dinha: That’s it.

Sramana Mitra: What do you plan to do with this company? Do you want to take this public?

Francis Dinha: We have been approached by a lot of venture capital and private equity firms. They want to come in and put some money. There is that possibility, but I’m not sure if I want to do a private equity kind of thing. We can do IPO, but we’re not there yet. We want to be over $100 million before we even consider an IPO. However, I tell my investor that if they want ROI, I’m willing to give them 4x.

Sramana Mitra: How many people do you have?

Francis Dinha: 150 people all over the world.

Sramana Mitra: It’s a virtual company.

Francis Dinha: From day one, I wanted to make sure that everyone can work from home. We could hire the best of the best. We have people in Germany, the Netherlands, and the Philippines. We have people in Ukraine. During the pandemic, we were able to operate this business. There are three options for us. I can pay my investor if they want a return or they can wait. They’re saying there’s no rush.

Sramana Mitra: They can see that their money is multiplying. You will deliver.

Francis Dinha: One of my investors said, “I’m not sure what I’m going to do with the cash.”

Sramana Mitra: Excellent! Thank you for your time.

This segment is part 4 in the series : From Hard Core Techie to Successful Entrepreneur: Francis Dinha, CEO of OpenVPN
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