1Password is raising $200M of VC

I don’t believe that was a wise decision from Dave and the 1P team, but that’s his company. Now anyone considering switching to another password manager?

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Why is that a bad thing?

Well, by that 1Password is no longer independent. That was something that a lot of us valued highly. Especially when they allegedly rejected an acquisition offer by Apple and instead won them over as probably their largest customer.

A $200M round is massive. The question is how much say will their investors get in the actual product/business decisions. Undoubtedly the only interest of VCs is to get a multiple of their money back. Often times quickly by selling off a perfectly mature company at the fist lucrative chance.
(See the beloved Sunrise calendar being acquired by Microsoft for $100M after raising in total $8.2M.)

The biggest problem with all this is trust, as the company is dealing with sensitive data and a lot users (as well in the B2B space) rely on the product to work. There are alternatives, but most of them are not as well established or integrated. And the larger your company the less easy is a transition of such a crucial piece of software.

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Not concerned in the slightest. This large a round of funding insures that the company won’t (easily) be flipped to a new buyer, and the purpose of the funding will be to spearhead aggressive investments into the lucrative, yet not yet tapped out, enterprise market.

The existence of strong competitors LastPass and Dashlane (which have free tiers) in addition to free-to-cheap apps and built-in OS solutions of various kinds, will keep 1Password honest and competitive (unless they eventually ‘pull a CrashPlan’ and leave the consumer market - unlikely for years given their customer base).

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1Password has 174 employees and will be needing twice that many. Based on the customers they already serve, such as IBM with 350,000+ employees I can understand needing to ramp up.

Accel is only purchasing a “minority stake in 1Password”. I’ve been using 1PW for nearly 12 years, and this doesn’t bother me at all.

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I already switched to Bitwarden. It’s E2EE, open-source and free.

This is no issue for me at all. Far from it: it gives them the ability to be even more innovative in the corporate space, and we will get the benefits from that in the private space.

nicely done by the 1P team!

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No necessarily a bad thing. But when you put $200M into a company, you’ll want some input into its business strategy and plans. As noted elsewhere, the VCs need to get their money back somehow.
This may turn out well and it may not - I have no idea what the likelihood is on either side.

I’ve been looking at alternatives, because I’m expecting 1P to drop their 1-time licence in favour of all-in subscriptions at some point. Having an alternative available if the deal does work out less well might be useful.

For anyone interested, Enpass seems like a reasonable bet as an alternative - low cost and secure sync via iCloud (passwords not held on a server)

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I think that 1Password has to grow… They have entered the corporate world in order to have a sustainable business in the long run. I get why they decided to enter this realm.

I do not see myself switching anywhere right now, but if I had to, it definitely would be a Open Source alternative in the future like KeePass or Bitwarden.

For the time being, I am very happy with 1Password (subscription). My vault contains 706 elements. Not all of them are passwords. I love 1Password on iOS and on MacOS. On Windows it does not feel that great (no, it has nothing to do with Windows :slight_smile: ).

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My hope is that this brings enough funding to make their apps / service easier to use and allows more people to be more secure online.

I think 1Password is a beautiful suite of software, but they are not user-friendly. I have shown/setup the service with countless people and no one outside of the tech realm has been able to usefully grok it. The software “works”, but there are so many areas that could be made more clear and user-friendly.

For now I’m not leaving 1Password, but because of the difficulties with other family members and work colleagues, I’d consider leaving if I found a solution that was more streamlined.

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DHH sharing his thoughts.

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1Password’s Dave Teare took to Reddit to explain the deal. Seems pretty reasonable to me, with a discussion of how and why … and why consumer users aren’t being abandoned.

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Because if he planned doing otherwise, he would publicly acknowledge it :slight_smile:

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From what I’ve read it’s mostly for the business/enterprise side of the company.

He describes in more detail what that means in his Reddit post. Nothing alarming I can see.

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Unless someone has access to the acquisition agreements, we can’t know for sure. I think Dave Teare is not lying when he says; he has control. But similar deals often include clauses for future share acquisitions, so Dave might have the control for now, but he might lose it. Investors like Accel also require clauses that allow them to override certain decisions in case their business interests might bet in jeopardy, etc. But it is something to consider. Especially in current paranoid times :slight_smile:

Why should we care what he thinks? Looks like he’s a software guy and not a business guy. From a business perspective doesn’t have a clue what he’s talking about. And you know what they say about opinions…

If 1Password got $200 million of VC investment, that strongly suggests the VCs think this company has growth potential. If the VCs leave the tech and creative stuff alone, the company will do great.

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True, as it’s also the largest single investment Accel has made, but we don’t know how much of a say, if any, they really have - it depends on the contract in the funding round, and Accel remains a minority stakeholder. And Accel hasn’t been particularly handsy in previous investments, which is a good sign.

The Globe and Mail reported “At least one-third of the funds are going into the company and the balance to the founders, with the new investors getting a minority stake.” One-third is $67 million, so the sum reported in headlines ignores that the rest of the money effectively allowed existing shareholders/employees/owners to cash out a portion of their holdings. (This allows for a delayed IPO, if indeed there ever is one.)

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@leo are you saying Apple uses 1Password and not their own Keychain?

They bought a big site license, and BGR then erroneously reported a year ago that Apple was looking into buying them. (Apple not-infrequently buys site licenses for lots of quality apps and utilities for employees, even ones that compete with Apple products.)

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