Backblaze, Inc. (NASDAQ:BLZE) Q4 2022 Earnings Call Transcript

And when they find back boys, they say, wow, that is very easy and really affordable. I can do that. And they end up leaving their on-premise infrastructure to move to back boys of the public cloud, but we don’t have a concrete breakdown between those two on the frequency.

Victor Chiu: And just to follow-up on the previous question, you noted that the sales cycles the elongation of some deal closures aren’t impacting you guys to the same degree. Are there specific trends or in instances that you are observing that gives you that – you can see that kind of helped explain why you are faring better than some of your peers in that regard?

Gleb Budman: Yes, I think actually just to clarify, it is not just that we are not seeing as much of a negative impact. We have actually seen some benefit over this time period. And I think that, we look at that as likely the result of two things. One is that, that customers are trying to optimize their cloud infrastructure spend. And a great way to do that is to switch from traditional providers or on-prem infrastructure. And the other is because as an organization, I think we are continuing to become more effective and efficient.

Operator: Our next question comes from Eric Martin newsy with Lake Street Capital Markets.

Eric Martin: Given the outlook for 2023, I was just curious if you could comment on the growth rates for the two different parts of the business. I know in 2022, we had the 46% growth from B2, but we had the price increase and the 17% growth from the computer backup business. Just for those of us modeling at home, I’m thinking that the B2 is probably still in that 40% range, but we could be in low single digits for computer backup.

GlebBudman: Hi, Erik. We don’t guide the product specifically, but when you use the guidance that we have provided and you kind of work with your model, you are going to get B2 in that low 40s with the difference coming into computer backup in the low single digits, low to mid-single digit.

Erik Suppige: Okay. And then the – given the price differential that you guys have, and the fact that you didn’t see any of the deal elongation that a lot of other people saw in Q4. Have you seen an increase in interest from large prospects? So, I wouldn’t expect large prospects to have kind of pulled the trigger on Backblaze really fast, but just kind of a pipeline of larger transactions is, how does that compare to say, six months or a year ago?

Frank Patchel: Yes. I think, we are always talking to companies of all sizes. I don’t think we have anything specific to say on the different sizes of organizations within the pipeline. Much of our business comes from the kind of the core of the mid-market for us. We are always in conversations with customers of different sizes, so I don’t think I have anything really concrete to say on the shift between the different parts of the pipeline.

Erik Suppige: Okay. And then the last question for me on the B2, congratulations on that self-serve success. It is great to see kind of a new high here in January of 2023 on the self-serve signups. What do you attribute that to? Is that the result of maybe an increased focus on sales, on channel development enhancements at the web, the economy? What’s the big driver there?