TeamViewer is a software company that specializes in remote access software and online collaboration products. The company was founded in 2005 with the aim of providing easy-to-use remote control solutions to both consumers and businesses – but how do they make money? This is the question we’ll answer in this article. We’ll explain in detail the business model of TeamViewer and uncover the different ways that it uses to make money.
TeamViewer offers a family of software products for IT-based remote support and collaboration. TeamViewer makes money by licensing its software technology on a per-seat basis and billing customers annually. It is free for personal use.
You like to read: Investment Company Name Ideas To Up Your Profits
TeamViewer is a secure, remote access software system developed by a German company, TeamViewer AG, founded in 2005. TeamViewer software is used by an IT technician to provide tech support via remote control of the device.
The company makes other software tools, such as TeamViewer Meeting for global collaboration, TeamViewer Tensor for secure SaaS Enterprise remote connectivity, TeamViewer Assist AR for augmented reality, and TeamViewer IoT to connect, monitor, and operate IoT devices.
How Does TeamViewer Make Money?
TeamViewer is free for personal use, limited to connections between one person and the computers of friends and family.
There are three levels of paid commercial use which are:
- Business Level: One user, with up to three devices, accessing up to 200 computers with up to 10 meeting participants, for $610.80 per year.
- Premium Level: Up to 15 users accessing up to 300 computers with up to ten meeting participants, for the cost of $1,234.80 per year.
- Corporate Level: Up to 30 users accessing up to 500 computers with up to ten meeting participants, for the cost of $2,482.80 per year.
The company offers a 14-day free trial for paid subscription plans.
- TeamViewer Remote Management add-ons cost $22.92 per year each. Support for mobile devices (iPad, iPhone, and Android) is an additional $394.80 per year.
- Service camp Service Desk with ticket management is $118.80 per agent per year.
- TeamViewer Assist AR add-on with augmented reality is $468.00 per technician per year.
TeamViewer has more than 200 million global users and more than 2.5 billion installations on IoT devices. The software is offered and supported in more than 30 languages.
The paid subscriptions are advertised, showing the equivalent of a monthly rate; however, the billings are done on a prepaid annual basis. The annual subscription renews automatically unless the customer cancels the contract by giving 28-days advance notice before the annual subscription renewal date.
The company intentionally makes it difficult to cancel an automatic contract renewal. If a customer does not cancel the contract in advance of the renewal date by 28 days, the customer’s credit card is automatically charged for the next year’s subscription.
This auto-renewal policy of the company has been the source of many complaints made to the Better Business Bureau. It is also the reason why a class action lawsuit has been filed in California ‑ Gershfield v. Teamviewer US, Inc. (Case No.: SACV 21-00058) ‑ claiming the auto-renewal charges are unauthorized and illegal under California law. The plaintiff in the class-action lawsuit is seeking US$6.5 million in statutory damages.
TeamViewer AG is a German company and reports its financial results in Euros. The company has been profitable since 2019.
Here is a table that summarizes the key elements of the company’s financials for the past three years (shown in thousands of Euros):
The number of subscribers in 2020 was 584,000. This figure was considerably higher than the 2019 subscribers of 464,000. Subscribers increased in 2020 by 26%. The net customer retention rate in 2020 was 103%, compared to 102% in 2019.
The equity ratio as a percentage of total assets in 2020 was 23% compared to 10% in 2019.
The company had 1,256 employees in 2020, compared to only 841 in 2019. This represents an increase of 49%. The increase in employees was the company’s response to the positive impact of the pandemic on sales.
Reuters reported that enterprise customers, with an annual contract value of more than €10,000, increased by 153% to 1,183 customers in 2020 compared to the previous year. Earnings per share remained the same at €0.52 for both 2019 and 2020.
2021 Quarterly Reports
The first quarter of the calendar year 2021 was a strong one for TeamViewer. The company continues to prepare for growth over the long term with the completion of two more acquisitions, Xaleon (customer engagement) and Upskill (industrial AR solutions).
TeamViewer added two more sports teams, Mercedes racing teams and the football club Manchester United, as promotional partners. The new Chief Marketing Officer, Lisa Agona, and the new President Americas, Patricia Nagle, plan to drive the sales for the global brand with expansion in the Americas region.
TeamViewer achieved record levels of billings in the first quarter of 2021, which even surpassed the increased billings experienced in the first quarter of 2020.
The company secured 300 million Euros as an ESG-linked loan on very favorable terms. An ESG-linked loan also called a Schuldschein loan, is debt financing with incentives for the borrower to meet sustainability objectives, such as receiving a better Environmental Social and Governance (ESG) rating.
Highlights from the 2021 first-quarter report, released on May 4, 2021, include:
- A 26% growth in billings, to €146.6 million when compared year-on-year with the first quarter of 2020.
- Adjusted EBITDA was up 22% to €90.0 million when compared year-on-year with the first quarter of 2020.
- The adjusted EBITDA margin was 61.4%.
The company gave its projections for the full year of 2021 to reach from 585 million Euros to 605 million Euros in billings with an adjusted EBITDA margin of 49% to 51% and revenue projections of 524 million Euros to 540 million Euros.
The second quarter 2021 report will be released on August 3, 2021.
TeamViewer AG Market Valuation
In 2014, TeamViewer was acquired for €870 million by the private equity firm Permira Holdings Ltd., based in Europe.
In preparation for the company going public in 2019, the company changed from selling licenses for its software to a subscription model. This made users with legacy versions of the software, who bought perpetual licenses, furious. TeamViewer received many complaints about this and even let them be posted on the TeamViewer Community forum.
The legal entity changed from TeamViewer Germany GmbH to TeamViewer AG for the IPO in September 2019. The initial listing of the stock was placed on the Frankfurt Stock Exchange.
The volume issued for the IPO was 84 million shares at the IPO price of €25.25, raising €2.2 billion and valuing the company at €5.25 billion. At that time, the IPO was the largest one for a German company since 2000 and the largest IPO in Europe in 2019.
Silicon Angle notes that the IPO gave Permira Holdings Ltd. a return of more than six times over what Permira paid for the company a mere five years before the IPO.
Currently, the stock trades as the stock symbol TMV.F on the Frankfurt Stock Exchange. The share price of around 28 Euros (July 30, 2021) gives the company a market cap of €5.7 billion. The P/E ratio is 60.62, with a 52-week high for the stock price of 49.64 Euros and a 52-week low of 27.03 Euros.
Owler says that TeamViewer AG raised €300 million in debt during March 2021.
Market Share of TeamViewer
Lyft reports that the market share for TeamViewer, as the market leader in this technology, is 34.45%. Its biggest competitor is DameWare, with a market share of 14.11%, followed by BeyondTrust with an 11.39% market share.
TeamViewer claims that 90% of Fortune 500 companies use TeamViewer software.
The global distribution of TeamViewer’s customer base is 42% in the United States, 9% in the U.K., and 5% in Canada, with 44% of its customers from the rest of the world.
The percentage of companies using TeamViewer that are small, with fewer than 50 employees, is 35% of the TeamViewer subscribers. Of the medium-sized companies with more than 50 employees but fewer than 1,000 employees, these companies represent 39% of TeamViewer’s subscribers. 25% of the TeamViewer subscribers come from large enterprise companies with more than 1,000 employees.
One notable large organization that uses TeamViewer is The American Red Cross, with more than 10,000 employees.
Pros and Cons of Using TeamViewer
TeamViewer is very useful for the tech support of remote workers. It is frequently used to share a desktop with an IT technician and let the tech support worker install new programs or update software and troubleshoot any problems.
The pros are that this software is very useful for guided training, online meetings, and virtual conferences and can accomplish remote file transfers and backups.
The cons are the price of using TeamViewer for commercial purposes and the additional cost of add-ons.
Features of TeamViewer
TeamViewer has excellent features which make it the best remote desktop software out there. These features are really helpful for users and businesses:
- Access Control
- Real-time Chat with Screen Sharing
- Remote Access, Printing, and Support
- Session Recording and Session Transfer
- Diagnostics Tools, Reporting, and Analytics
- File Sharing and Transfer
- Collaboration, Meetings, and Presentations
- Mobile Access
The innovative add-ons are the TeamViewer Assist AR which uses augmented reality for frontline technical support, and TeamViewer IoT to connect, monitor, and operate IoT devices.
Augmented reality uses real-time photo overlays captured by remote technicians as visual guides for tech support to assist the worker in making repairs.
TeamViewer is Cross-Platform
TeamViewer provides remote access software and solutions for online collaboration, desktop sharing, IT administration, helpdesk, computer support, and home office use.
TeamViewer works with all devices and platforms, including Windows, Mac, Linux, iOS, iPhone/iPad, and Android devices.
Deployment and use of TeamViewer can be done using a web browser, via a download of the software, or as SaaS cloud services.
Conclusion: How Does TeamViewer Make Money?
In conclusion, TeamViewer is a popular remote access software that earns money by selling Business licenses, Premium licenses, and Corporate licenses to use its product. It is among the most popular remote access software on the current market due to its ease of use and being free for personal use.
There’s even a free trial period that gives you a pretty good idea of what it would cost to start hosting your own screen-sharing software.
And honestly, TeamViewer deserves every bit of praise it receives – not only are their business practices sound but they boast a global community of customers and partners that say positive things about them.
You may like to read: Profitable Blue Collar Business Ideas to Know