- The Göppingen-based software company Teamviewer benefits from the new working conditions in the Corona crisis.
- The remote maintenance and home office software provider presented strong quarterly figures on Tuesday.
- NewsABC.net spoke to Teamviewer boss Oliver Steil, one of the best-earning top managers in Germany, about the company’s success.
Oliver Steil calls for the interview via his company’s app. Blizz is the name of the application for video conferencing and office communication and it works similarly to Zoom, Microsoft Teams or Skype. The video does not come today, however, a small microphone shines next to the profile photo of a smiling Oliver Steil in a light blue shirt, the best-earning top manager in Germany.
Steil is the CEO of Teamviewer, one of the most successful software companies in Germany. The company has been developing software from Göppingen in Swabia for 15 years, which can be used to remotely control other devices, from computer to computer. The process is called “Remote Access”. The Teamviewer can be used, for example, by IT departments of corporate groups to access their employees’ desktops in the home office and to eliminate technical problems.
The tool is particularly in demand in the Corona crisis, which is why Teamviewer is currently experiencing a high. This is shown by the figures from the first quarter published on Tuesday: The billed income (billings) grew by 75 percent compared to the previous year and reached a record value of 119.7 million euros.
Half a million paying customers
“The corona pandemic should lead to a surge in digitalization, as more and more companies are thinking about how to work remotely,” says Oliver Steil. The Göppingen-based company noticed this above all in the increased number of customers. In the first quarter of the year, Teamviewer was able to win 50,000 new paying corporate customers for the remote maintenance tool and thus has a total of 514,000 subscribers. There are also a number of private users. In total, Teamviewer software solutions were installed on more than 2.25 billion devices by the end of March.
“The accelerated digitization by Corona is not just a flash in the pan, we expect long-term and sustainable effects on our business,” says Oliver Steil. Many employers see large and long-term efficiency potential as a result of moving to their home office. As a result, Steil and CFO Stefan Gaiser have raised the full-year forecast and now expect billings of around 450 million euros for the 2020 financial year.
The Teamviewer business model lives from the subscription fees of corporate customers. Depending on the size of the company, the service costs are between 240 and well over half a million euros per year. From the small company with three employees to the multinational group with 100,000 employees, everything is included, including from all industries. More than half of the Fortune 500 companies were or are subscribers.
Both Steil and CFO Stefan Gaiser played a key role in the success. At the beginning of 2018, Steil switched from the investment company Permira to Teamviewer after Permira bought the Göppingen company in 2014 for 870 million euros. “Permira as the owner was very important in our growth story,” says Steil in an interview with NewsABC.net. After Steil’s change, everything went very quickly: within two years, Teamviewer grew from 600 to almost 1,000 employees at the time and in 2019 was the largest IPO of a tech company since the dotcom bubble burst.
A remuneration of 41.3 million euros
The top management now benefits particularly from the success of the company. For 2019, Steil received a record remuneration of EUR 41.3 million. They should be the highest paid managers in Dax and MDax. For comparison: The average annual salary of a board member in a Dax company was 3.51 million euros in 2018.
Steil’s remuneration is made up of several components. On the one hand from his fixed salary as a manager in the amount of 810,000 euros, on the other hand he receives almost 40 million euros as a participation from Permira. When Gaiser and Steil joined the company at the beginning of 2018, they invested in the company with equity and in return were involved in increasing the company’s value. Permira also involved 80 other Teamviewer executives. Back then, things weren’t going so well. “At that point the company was growing less, there was less investment in marketing and sales,” says Gaiser. Steil added: “Of course that was also a certain entrepreneurial risk for us and could have gone wrong.”
But what is the mood like in a company when the bosses earn so much more? “So far, we haven’t perceived this as a problem internally. The mood is very good, but we also pay good salaries and also involve every employee in the company’s success through variable salary components, ”says Steil. All employees would also have received an IPO bonus for the IPO.
Focus on remote maintenance
Teamviewer’s competitors are not other video conferencing services like Zoom or Microsoft Teams. “For us, the video chat tool is more of a by-product; our core product is about remote control of machines, devices and systems,” says Steil. And in this area, Teamviewer is almost alone in the wide field.
What distinguishes Teamviewer from other providers: With the remote control tool, customers can not only access their employees’ computer desktops, but also virtually any device – regardless of whether they are large machines in production, cell phones, credit card terminals in the supermarket or even equipment in the laboratory.
To a certain extent, Teamviewer competes with Siemens and Bosch, who build their customers specially developed IoT platforms for this purpose. “Of course, this takes much longer and is significantly more expensive. With us, customers receive a ready-made and comparatively inexpensive connectivity platform that is ready for immediate use, ”says Steil.
Are cloud services reaching their limits?
However, the increased number of users due to the Corona crisis is putting cloud services such as Zoom or Teamviewer to the test, Telekom CEO Thimotheus Höttges recently told the “Handelsblatt”. Because when suddenly many people use video conferences, a very large amount of data is exchanged. “Of course, this also applies to our video product Blizz, but we increased the router capacity accordingly,” says Steil.
In remote maintenance, the core business area, the amount of data transferred is significantly lower and the connections are less frequent, explains Steil. It was “not a comparison to the data load from video conferences.”
Big plans for the coming year
Steil still has some plans for Teamviewer. The first step was to steer the company safely through the crisis and recession. “In the long term, however, we will continue to try to be innovative, including investing further in the area of IoT and AR, and developing solutions for new industries here,” said Steil.
In 2020 and 2021, the company initially wanted to promote the dissemination of the products and continue to focus heavily on large customers. Many new employees in sales and marketing would be hired worldwide for this. This also goes hand in hand with strengthening international representative offices – such as on the west coast of the USA. The United States is the most important market for German software developers.
Steil’s vision: “We want to become one of the most relevant companies in the software industry worldwide, in Europe we already are.” The numbers indicate that the manager could succeed.