Sanjiva Weerawarana’s Remarkable Journey
Sanjiva Weerawarana’s journey is a testament to the potential of a Sri Lankan software startup. He founded WSO2, an enterprise software firm, in 2005 and grew it to nearly $100 million in annual recurring revenue (ARR). In May, the company was acquired by private equity firm EQT for $600 million, marking a milestone for Sri Lankan tech startups.
Building a Sri Lankan Software Startup Against All Odds
WSO2, headquartered in Colombo, Sri Lanka, is an open-source enterprise software provider. It counts major companies like Samsung, Axa, and AT&T among its clients. The acquisition deal, which is pending regulatory approval, will see EQT becoming the sole owner by acquiring all outstanding shares, including those held by WSO2’s investors and employees. Remarkably, 30% of the proceeds will go to the employees, potentially creating significant wealth for those looking to start their own ventures.
“This validates the importance of equity,” said Weerawarana. “From day one, every employee has been a shareholder. Now, we see meaningful financial returns for our people.”
Thriving Amidst Challenges
Despite Sri Lanka’s civil war and external pressures to relocate to the U.S., Weerawarana chose to build WSO2 in his home country. “I returned to Sri Lanka in 2001, just before a terrorist attack on the airport. Despite the ongoing war in 2005, we built our company here,” he said. His commitment to developing a product-oriented tech company in Sri Lanka was a unique approach at the time, compared to the prevalent service-oriented companies in the region.
Strategic Investments and Growth of the Sri Lankan Software Startup
WSO2’s middleware stack, including tools for API management and identity and access management (IAM), has gained significant traction. Weerawarana’s vision and persistence attracted key investments, starting with a $2 million investment from Intel Capital in 2006.
Intel’s investment manager, Pradeep Tagare, saw the potential in WSO2 due to the growing open-source movement. “Open source allowed developers outside big tech companies to contribute significantly. WSO2 fit perfectly into this strategy,” Tagare said.
WSO2 has since adapted to technological advancements, positioning itself well with the rise of cloud computing and microservices. Recently, the company launched an AI-powered API manager, integrating AI into its offerings.
A Vision for the Future
Despite selling to private equity, Weerawarana believes this aligns with his long-term vision. “EQT’s goal is to build around WSO2 for five years, which aligns with our vision and gives us the runway to reach an IPO,” he stated. This acquisition highlights the potential of building world-class technology companies outside traditional tech hubs, focusing on innovation, resilience, and strategic growth.
