A success story from Sri Lanka is Sanjiva Weerawarana. Established in 2005, he led enterprise software company WSO2 to nearly $100 million in annual revenue as its CEO before selling it to EQT, a private equity group, in May for $600 million.
He also occasionally drives for Uber.
Although Sri Lanka isn’t known for having a vibrant startup scene, for the past 20 years, one business in the island nation of South Asia has stood out. At a valuation that TechCrunch projected at the time to be north of $600 million, WSO2, an open source enterprise software provider with clients including Samsung, Axa, and AT&T, recently agreed to be acquired by private equity behemoth EQT. (At this point, we are able to verify that the valuation was precisely $600 million.)
Through the deal, which is still pending regulatory approval, EQT will acquire all of WSO2’s outstanding shares, including those held by investors and both current and former workers.
Because those who are motivated to launch their own businesses will receive thirty percent of the benefits from this liquidity event, it might potentially result in enormous wealth creation for those individuals.
WSO2 co-founder and CEO Sanjiva Weerawarana told TechCrunch in an interview, “This shows that equity is important—one of the things that we have insisted on from day one is that every employee has been a shareholder.” This is a really essential topic that hasn’t been fully appreciated here before because there haven’t been any enterprises that have left and provided a significant financial return. Observing
Sanjiva Weerawarana is a Sri Lankan success story. He founded enterprise software firm WSO2 in 2005, got it close to $100 million in ARR as its CEO, then sold it to private equity firm EQT for $600 million in May.
He sometimes drives for Uber, too.
Sri Lanka isn’t renowned for its startup ecosystem, but one company has been something of an outlier in the South Asian island nation these past two decades. WSO2, an open source enterprise software provider with customers such as Samsung, Axa, and AT&T, recently agreed to be acquired by private equity giant EQT, at a valuation TechCrunch reported at the time to be north of $600 million. (We can now confirm that the valuation was in fact exactly $600 million.)
thriving despite conflict and turmoil
Founded in 2005 in the capital city of Sri Lanka, Colombo, WSO2 is a middleware stack that includes solutions like identity and access management (IAM) akin to publicly traded Okta, which is valued at $15 billion, and API management like to Apigee, which Google purchased for $625 million.
Weerawarana, a computer scientist and influential figure in the open source community for the past 25 years—not only as a member of the Apache Software Foundation but also, more recently, as the creator of Ballerina, a general-purpose programming language that is cloud-native and designed to integrate distributed systems—has been the primary force behind this.
Weerawarana was a member of IBM’s research and development team in the United States before to WSO2, where he contributed to the creation of web service specifications including WSDL andthriving despite conflict and turmoil
Founded in 2005 in the capital city of Sri Lanka, Colombo, WSO2 is a middleware stack that includes solutions like identity and access management (IAM) akin to publicly traded Okta, which is valued at $15 billion, and API management like to Apigee, which Google purchased for $625 million.
Weerawarana, a computer scientist and influential figure in the open source community for the past 25 years—not only as a member of the Apache Software Foundation but also, more recently, as the creator of Ballerina, a general-purpose programming language that is cloud-native and designed to integrate distributed systems—has been the primary force behind this.
Weerawarana was a member of IBM’s research and development team in the United States before to WSO2, where he contributed to the creation of web service specifications including WSDL and
came back [to Sri Lanka] in 2001, and the airport was attacked by a terrorist organization two weeks before I touched down in Colombo—there were still airplane fragments on the ground,” he recalled. By 2005, the conflict had not ended. It’s acceptable that Sri Lanka hasn’t been able to provide us with a steady, peaceful atmosphere.
Eighty percent of WSO2’s seven hundred workers work in Sri Lanka now, with the other members dispersed
throughout many hubs in the United States, Europe, and Asia.
Weerawarana went on, “I wanted to demonstrate that we could create a product-oriented tech company from Sri Lanka.” “There had never been a business like this, and there wasn’t even an Indian business like this at the time.
nvestors weren’t the only ones who pressured WSO2 to move: Customers and competitors have also used its location against it at various junctures.
“Some of our competitors fought against us, saying, ‘Do you know where they are located?’ and that becomes a challenge,” Weerawarana said. “Then we’ve had customers saying, ‘You’re located way over there. Why are you charging us these prices?’”
On the flip side, WSO2’s geographic setting gave it the pick of technical talent, owning mostly to the fact that it was a product-based business in a sea of services.
“We’ve never had a problem with engineering and technical talent. We’ve been able to hire the best people in Sri Lanka for the last 19 years,” Weerawarana said. “If you are a creative engineer, would you rather work for a services company, or be in a role where you could be creative and work on top-of-the-line technology?”
Intel internal
Following a modest amount of angel funding in 2005, Intel’s venture capital division became WSO2’s first
supporter, contributing funds in 2006 and through multiple follow-on rounds in the years that followed.
WSO2 benefited greatly from Intel Capital’s initial $2 million funding infusion, which came about at opportune moment. During that period, Weerawarana was introduced to Pradeep Tagare, a senior investment manager at Intel Capital, by means of their affiliation with the Apache Software Foundation. In order to balance its two previous open source investments, which it had made in the database business MySQL (which Sun eventually purchased for $350 million) and the Java-focused application server company JBoss (which Red Hat later acquired for $350 million), Tagare was looking to invest in an open source venture.
We were looking at a bunch of open source investments as a strategic initiative for Intel, essentially to build an alternate stack on Intel hardware,” Tagare explained to TechCrunch. “We had invested in JBoss, and we invested in MySQL. So we were now looking for an open source middleware company, and WSO2 fit the bill exactly.”
Tagare’s thesis was that countries situated in Asia would not only stand to benefit from the open source movement, but would also be likely to contribute a lot. Open source software development is naturally distributed, opening up the coding and collaboration process to those who didn’t work at the Big Tech companies of those times.
“Before, everything was really controlled by the Microsofts and the Oracles of the world. Now they could contribute,” Tagare remarked. “Being based in Asia made WSO2 even more interesting, but its location wasn’t necessarily a requirement.”
In the two decades since WSO2 first appeared on the scene, a lot has changed. WSO2 is in a good position to help organizations move away from traditional monolithic programs as a result of the emergence of cloud computing and microservices, which are software composed of smaller, loosely coupled components that can be developed and maintained independently and that neatly rely on APIs.