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OwnBackup lands $50M as backup for Salesforce ecosystem thrives
OwnBackup has made a name for itself primarily as a backup and disaster recovery system for the Salesforce ecosystem, and today the company announced a $50 million investment.
Insight Partners led the round, with participation from Salesforce Ventures and Vertex Ventures. This chunk of money comes on top of a $23 million round from a year ago, and brings the total raised to more than $100 million, according to the company.
It shouldn’t come as a surprise that Salesforce Ventures chipped in when the majority of the company’s backup and recovery business involves the Salesforce ecosystem, although the company will be looking to expand beyond that with the new money.
“We’ve seen such growth over the last two and a half years around the Salesforce ecosystem, and the other ISV partners like Veeva and nCino that we’ve remained focused within the Salesforce space. But with this funding, we will expand over the next 12 months into a few new ecosystems,” company CEO Sam Gutmann told TechCrunch.
In spite of the pandemic, the company continues to grow, adding 250 new customers last quarter, bringing it to over 2,000 customers and 250 employees, according to Gutmann.
He says that raising the round, which closed at the beginning of May, had some hairy moments as the pandemic began to take hold across the world and worsen in the U.S. For a time, he began talking to new investors in case his existing ones got cold feet. As it turned out, when the quarterly numbers came in strong, the existing ones came back and the round was oversubscribed, Gutmann said.
“Q2 frankly was a record quarter for us, adding over 250 new accounts, and we’re seeing companies start to really understand how critical this is,” he said.
The company plans to continue hiring through the pandemic, although he says it might not be quite as aggressively as they once thought. Like many companies, even though they plan to hire, they are continually assessing the market. At this point, he foresees growing the workforce by about another 50 people this year, but that’s about as far as he can look ahead right now.
Gutmann says he is working with his management team to make sure he has a diverse workforce right up to the executive level, but he says it’s challenging. “I think our lower ranks are actually quite diverse, but as you get up into the leadership team, you can see on the website unfortunately we’re not there yet,” he said.
They are instructing their recruiting teams to look for diverse candidates whether by gender or ethnicity, and employees have formed a diversity and inclusion task force with internal training, particularly for managers around interviewing techniques.
He says going remote has been difficult, and he misses seeing his employees in the office. He hopes to have at least some come back before the end of the summer and slowly add more as we get into the fall, but that will depend on how things go.
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Tech shares set fresh records despite uncertain economy
Despite record-setting COVID-19 infections, American equities rose today. All major indices gained ground during regular trading, while tech stocks did even better.
The Nasdaq Composite set new 52-week and all-time highs, touching 10,462.0 points before closing at 10,433.65, up 2.21% on the day. Similarly, a basket of SaaS and cloud companies that has risen and fallen more sharply than even the tech-heavy Nasdaq closed this afternoon at 1,908.30 after touching 1,952.39 points. Both results were 52-week and all-time highs.
Such is the mood on Wall Street regarding the health of technology companies. It’s not hard to find bullish sentiment, jockeying to push tech shares higher. Some examples of today’s enthusiasm paint the picture:
- The recent IPO for Lemonade is now worth $4.7 billion, according to Yahoo Finance. That price gives it a Q1-annualized revenue run rate multiple of around 45x. For a SaaS company, that would boggle the mind. As we’ve written, however, Lemonade has very un-SaaS-like gross margins, and has higher churn. The company’s stock rose around 17% today for no clear reason.
- Tesla rose over 13% today to $1,371.58 per share, another huge day of gains for the company now worth in excess of $250 billion. Analysts expect the firm to report $4.83 billion in revenue in its most recent quarter, according to Yahoo Finance. That’s less than the company reported in its year-ago June quarter when it saw $6.35 billion in revenue. Since July 1, 2019, Tesla shares have appreciated in excess of 450%, despite the company prepping to report what the market anticipates will be revenue declines.
- Amazon and Netflix also set new records today to toss a few more names into the mix.
You can’t swing your arms without running into a reason why it makes sense for SaaS stocks to be trading at record valuation multiples, or why one company or another is actually reasonably valued over a long-enough time horizon.
It’s worth noting that this putatively rational public investor thinking doesn’t fit at all with what the tech set used to pound into my head about the public markets, namely that they are infamously impatient and thus utter bilge for most long-term value creation. Going public was garbage, I was told; you have to report every three months and no one looks out a few years.
Now, I’m being told by roughly the same people that the market is doing the very thing that they said it didn’t do, namely price firms for future results instead of trailing outcomes. Fine by me either way, frankly, but I’d like to know which story is true.
Happily, we’re about to see if all this high-fiving and enthusiasm is real.
Earnings season beckons, and it should bring with it a dose or two of clarity. If the digital transformation has managed to accelerate sufficiently that most tech companies have managed to greatly boost their near-term value, hats off to the cohort and bully for the startups that must also be enjoying similar revenue upswells.
But that doesn’t have to happen. There are possible earnings result sets that can cause investors to dump tech shares, as Slack learned a month ago.
The background to all of this is that there are good reasons to have some doubts about the current health of the national economy. And, sure, most people are willing to allow that the stock market and the aggregate domestic economy are not perfectly linked — this is no less than partially true — but each day the stock market steps higher and COVID-19 surges again leading to re-closings around the nation makes you to wonder if this is all for real.
Earnings season is here soon. Let’s find out.
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QuestDB nabs $2.3M seed to build open source time series database
QuestDB, a member of the Y Combinator summer 2020 cohort, is building an open source time series database with speed top of mind. Today the startup announced a $2.3 million seed round.
Episode1 Ventures led the round with assistance from Seedcamp, 7percent Ventures, YCombinator, Kima Ventures and several unnamed angel investors.
The database was originally conceived in 2013 when current CTO Vlad Ilyushchenko was building trading systems for a financial services company and he was frustrated by the performance limitations of the databases available at the time, so he began building a database that could handle large amounts of data and process it extremely fast.
For a number of years, QuestDB was a side project, a labor of love for Ilyushchenko until he met his other co-founders Nicolas Hourcard, who became CEO and Tancrede Collard, who became CPO, and the three decided to build a startup on top of the open source project last year.
“We’re building an open source database for time series data, and time series databases are a multi-billion-dollar market because they’re central for financial services, IoT and other enterprise applications. And we basically make it easy to handle explosive amounts of data, and to reduce infrastructure costs massively,” Hourcard told TechCrunch.
He adds that it’s also about high performance. “We recently released a demo that you can access from our website that enables you to query a super large datasets — 1.6 billion rows with sub-second queries, mostly, and that just illustrates how performant the software is,” he said.
He sees open source as a way to build adoption from the bottom up inside organizations, winning the hearts and minds of developers first, then moving deeper in the company when they eventually build a managed cloud version of the product. For now, being open source also helps them as a small team to have a community of contributors help build the database and add to its feature set.
“We’ve got this open source product that is free to use, and it’s pretty important for us to have such a distribution model because we can basically empower developers to solve their problems, and we can ask for contributions from various communities. […] And this is really a way to spur adoption,” Hourcard said.
He says that working with YC has allowed them to talk to other companies in the ecosystem who have built similar open source-based startups and that’s been helpful, but it has also helped them learn to set and meet goals and have access to some of the biggest names in Silicon Valley, including Marc Andreessen, who delivered a talk to the cohort the same day we spoke.
Today the company has seven employees, including the three founders, spread out across the US, EU and South America. He sees this geographic diversity helping when it comes to building a diverse team in the future. “We definitely want to have more diverse backgrounds to make sure that we keep having a diverse team and we’re very strongly committed to that.”
For the short term, the company wants to continue building its community, working on continuing to improve the open source product, while working on the managed cloud product.
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SEC filing indicates big data provider Palantir is raising $961M, $550M of it already secured
Palantir, the sometimes controversial, but always secretive, big data and analytics provider that works with governments and other public and private organizations to power national security, health and a variety of other services, has reportedly been eyeing a public listing this autumn. But in the meantime it’s also continuing to push ahead in the private markets.
The company has filed a Form D — its first in four years — indicating that it is in the process of raising nearly $1 billion — $961,099,010, to be exact — with $549,727,437 of that already sold, and a further $411,371,573 remaining to be raised.
(A Reuters report from June confirmed that Palantir had closed funding from two strategic investors that both work with the company: $500 million from Japanese insurance company Sompo Holdings, and $50 million from Fujitsu. Together, it seems like these might account for $550 million noted as already sold on the Form D.)
The Form D also notes that 58 investors are already attached to the offering, and that “of the total remaining to be sold, all but $671,576.25 represents shares of common stock already subscribed for.” This means that Palantir has already secured commitments for the remaining part of the $961 million raise, although the offering has not closed.
Palantir declined to comment on the filing, except to note that this is related to primary investments, not secondary stakes.
It’s not clear if this latest fundraise, as spelled out by the Form D, spells a delay to a public listing, or if the intention is to complement it.
The filing also appears to confirm a report from September 2019 that Palantir was seeking to raise between $1 billion and $3 billion, its first fundraising in four years.
That report noted Palantir was targeting a $26 billion valuation, up from $20 billion four years ago. The Reuters article in June put its valuation based on secondary market trades at between $10 billion and $14 billion.
To date, Palantir has raised at least $3.3 billion in funding, according to PitchBook, which names no fewer than 108 investors on its cap table.
The PitchBook data (some of which is behind a paywall) also indicates that Palantir has raised a number of previous rounds of undisclosed amounts.
Palantir was last valued at $20 billion when it raised money four years ago, but there are some data points that point to a bigger valuation today.
While the coronavirus pandemic has all but halted the IPO market, we are starting to see some movement again, and Palantir’s own business activity points to what might be a strong candidate to usher in more activity.
In April, according to a Bloomberg report, the company briefed investors with documents showing that it expects to make $1 billion in revenues this year, up 38% on 2019, and breaking even in the first time since being founded 16 years ago by Peter Thiel, Nathan Gettings, Joe Lonsdale, Stephen Cohen and current CEO Alex Karp.
(The Bloomberg report didn’t explain why Palantir was briefing investors, whether for a potential public listing, or for the fundraise we’re reporting on here, or something else.)
On top of that, the company has been in the news a lot around the global novel coronavirus pandemic.
Specifically, it’s been winning business, in the form of projects in major markets like the U.K. (where it’s part of a consortium of companies working with the NHS on a COVID-19 data trove) and the U.S. (where it’s been working on a COVID-19 tracker for the federal government and a project with the CDC), and possibly others. Those projects will presumably need a lot of upfront capital to set up and run, alongside other business deals that Palantir has been securing — possibly one reason it is raising money now.
Updated throughout, including with response from Palantir.
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Unpacking how Dell’s debt load and VMware stake could come together
Last week, we discussed the possibility that Dell could be exploring a sale of VMware as a way to deal with its hefty debt load, a weight that continues to linger since its $67 billion acquisition of EMC in 2016. VMware was the most valuable asset in the EMC family of companies, and it remains central to Dell’s hybrid cloud strategy today.
As CNBC pointed out last week, VMware is a far more valuable company than Dell itself, with a market cap of almost $62 billion. Dell, on the other hand, has a market cap of around $39 billion.
How is Dell, which owns 81% of VMware, worth less than the company it controls? We believe it’s related to that debt, and if we’re right, Dell could unlock lots of its own value by reducing its indebtedness. In that light, the sale, partial or otherwise, of VMware starts to look like a no-brainer from a financial perspective.
At the end of its most recent quarter, Dell had $8.4 billion in short-term debt and long-term debts totaling $48.4 billion. That’s a lot, but Dell has the ability to pay down a significant portion of that by leveraging the value locked inside its stake in VMware.
Yes, but …
Nothing is ever as simple as it seems. As Holger Mueller from Constellation Research pointed out in our article last week, VMware is the one piece of the Dell family that is really continuing to innovate. Meanwhile, Dell and EMC are stuck in hardware hell at a time when companies are moving faster than ever expected to the cloud due to the pandemic.
Dell is essentially being handicapped by a core business that involves selling computers, storage and the like to in-house data centers. While it’s also looking to modernize that approach by trying to be the hybrid link between on-premise and the cloud, the economy is also working against it. The pandemic has made the difficult prospect of large enterprise selling even more challenging without large conferences, golf outings and business lunches to grease the skids of commerce.
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Minneapolis-based VC shop Bread & Butter focuses on its own backyard
While many investors say sheltering in place has broadened their appetite for funding companies located outside major hubs, one firm is doubling down on backing startups in America’s heartland.
Launched in 2016 by Brett Brohl, The Syndicate Fund rebranded to Bread & Butter Ventures earlier this month (a reference to one of Minnesota’s many nicknames). Along with the rebrand, longtime Google executive and Revolution partner Mary Grove joined the team as a general partner and Stephanie Rich came aboard as head of platform.
The growth of the Twin Cities’ startup ecosystem is precisely why The Syndicate Fund rebranded. The firm, which has $10 million in assets under management, will invest in three of Minneapolis’ biggest strengths: agriculture and food, health care and enterprise software.
Agtech interest spans the entire spectrum from farming to restaurants and grocery stores. The firm is also interested in the “messy middle” of supply chain and logistics around food, said Brohl and is interested in a mix of software, hardware and biosciences. Within health care, the firm evaluates solutions focused on prevention versus treatment, female health startups working on maternal health and fertility and software focused on the aging population and millennials.
It’s also looking at enterprise software that can serve large businesses and scale efficiently.
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Vendia raises $5.1M for its multicloud serverless platform
When the inventor of AWS Lambda, Tim Wagner, and the former head of blockchain at AWS, Shruthi Rao, co-found a startup, it’s probably worth paying attention. Vendia, as the new venture is called, combines the best of serverless and blockchain to help build a truly multicloud serverless platform for better data and code sharing.
Today, the Vendia team announced that it has raised a $5.1 million seed funding round, led by Neotribe’s Swaroop ‘Kittu’ Kolluri. Correlation Ventures, WestWave Capital, HWVP, Firebolt Ventures, Floodgate and FuturePerfect Ventures also participated in this oversubscribed round.
Image Credits: Vendia
Seeing Wagner at the helm of a blockchain-centric startup isn’t exactly a surprise. After building Lambda at AWS, he spent some time as VP of engineering at Coinbase, where he left about a year ago to build Vendia.
“One day, Coinbase approached me and said, ‘Hey, maybe we could do for the financial system what you’ve been doing over there for the cloud system,’” he told me. “And so I got interested in that. We had some conversations. I ended up going to Coinbase and spent a little over a year there as the VP of Engineering, helping them to set the stage for some of that platform work and tripling the size of the team.” He noted that Coinbase may be one of the few companies where distributed ledgers are actually mission-critical to their business, yet even Coinbase had a hard time scaling its Ethereum fleet, for example, and there was no cloud-based service available to help it do so.
Tim Wagner, Vendia co-founder and CEO. Image Credits: Vendia
“The thing that came to me as I was working there was why don’t we bring these two things together? Nobody’s thinking about how would you build a distributed ledger or blockchain as if it were a cloud service, with all the things that we’ve learned over the course of the last 10 years building out the public cloud and learning how to do it at scale,” he said.
Wagner then joined forces with Rao, who spent a lot of time in her role at AWS talking to blockchain customers. One thing she noticed was that while it makes a lot of sense to use blockchain to establish trust in a public setting, that’s really not an issue for enterprise.
“After the 500th customer, it started to make sense,” she said. “These customers had made quite a bit of investment in IoT and edge devices. They were gathering massive amounts of data. They also made investments on the other side, with AI and ML and analytics. And they said, ‘Well, there’s a lot of data and I want to push all of this data through these intelligent systems. I need a mechanism to get this data.’” But the majority of that data often comes from third-party services. At the same time, most blockchain proof of concepts weren’t moving into any real production usage because the process was often far too complex, especially enterprises that maybe wanted to connect their systems to those of their partners.
Shruthi Rao, Vendia co-founder and CBO. Image Credits: Vendia
“We are asking these partners to spin up Kubernetes clusters and install blockchain nodes. Why is that? That’s because for blockchain to bring trust into a system to ensure trust, you have to own your own data. And to own your own data, you need your own node. So we’re solving fundamentally the wrong problem,” she explained.
The first product Vendia is bringing to market is Vendia Share, a way for businesses to share data with partners (and across clouds) in real-time, all without giving up control over that data. As Wagner noted, businesses often want to share large data sets but they also want to ensure they can control who has access to that data. For those users, Vendia is essentially a virtual data lake with provenance tracking and tamper-proofing built in.
The company, which mostly raised this round after the coronavirus pandemic took hold in the U.S., is already working with a couple of design partners in multiple industries to test out its ideas, and plans to use the new funding to expand its engineering team to build out its tools.
“At Neotribe Ventures, we invest in breakthrough technologies that stretch the imagination and partner with companies that have category creation potential built upon a deep-tech platform,” said Neotribe founder and managing director Kolluri. “When we heard the Vendia story, it was a no-brainer for us. The size of the market for multiparty, multicloud data and code aggregation is enormous and only grows larger as companies capture every last bit of data. Vendia’s serverless-based technology offers benefits such as ease of experimentation, no operational heavy lifting and a pay-as-you-go pricing model, making it both very consumable and highly disruptive. Given both Tim and Shruthi’s backgrounds, we know we’ve found an ideal ‘Founder fit’ to solve this problem! We are very excited to be the lead investors and be a part of their journey.”
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Fauna raises an additional $27M to turn databases into a simple API call
Databases have always been a complex part of the equation for developers requiring a delicate balance to manage inside the application, but Fauna wants to make adding a database a simple API call, and today it announced $27 million in new funding.
The round, which is technically an extension of the company’s 2017 Series A, was led by Madrona Venture Group with participation from Addition, GV, CRV, Quest Ventures and a number of individual investors. Today’s investment brings the total raised to $57 million, according to the company.
While it was at it, the company also added some executive fire power, announcing that it was bringing on former Okta chief product officer Eric Berg as CEO and former Snowflake CEO Bob Muglia as Chairman.
Companies like Stripe for payments and Twilio for communications are the poster children for the move to APIs. Instead of building sophisticated functionality from scratch, a developer can use an API call to a service, and presto, has the tooling built in without any fuss. Fauna does the same thing for databases.
“Within a few lines of code with Fauna, developers can add a full-featured globally distributed database to their applications. They can simplify code, reduce costs and ship faster because they never again worry about database issues such as correctness, capacity, scalability, replication, etc,” new CEO Berg told TechCrunch.
To automate the process even further, the database is serverless, meaning that it scales up or down automatically to meet the needs of the application. Company co-founder Evan Weaver, who has moved to CTO with the hiring of Berg, says that Stripe is a good example of how this works. “You don’t think about provisioning Stripe because you don’t have to. […] You sign up for an account and beyond that you don’t have to provision or operate anything,” Weaver explained.
Like most API companies, it’s working at the developer level to build community and developer consensus around it. Today, they have 25,000 developers using the tool. While they don’t have an open-source version, they try to attract developer interest with a generous free tier, after which you can pay as you go or set up a fixed monthly pricing as you scale up.
The company has always been 100% remote, so when COVID hit, it didn’t really change anything about the way the company’s 40 employees work. As the company grows, Berg says it has aggressive goals around diversity and inclusion.
“Our recruiting and HR team have some pretty aggressive targets in terms of thinking about diversity in our pipelines and in our recruiting efforts, and because we’re a small team today we have the ability to impact that as we grow. If we doubled the size of the company, we could shift those percentages pretty dramatically, so it’s something that is definitely top of mind for us.”
Weaver says that fundraising began at the beginning of this year before COVID hit, but the term sheet wasn’t signed until March. He admits being nervous throughout the process, especially as the pandemic took hold. A company like Fauna is highly technical and takes time to grow, and he worried getting investors to understand that, even without a bleak economic picture, was challenging.
“It’s a deep tech business and it takes real capital to grow and scale. It’s a high-risk, high-reward bet, which is easier to fund in boom times, but broadly I think the best companies get built during recessions when there’s less competition for talent and there’s more focus on capital.”
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Apple device management company Jamf files S-1 as it prepares to go public
Jamf, the Apple device management company, filed to go public today. Jamf might not be a household name, but the Minnesota company has been around since 2002 helping companies manage their Apple equipment.
In the early days, that was Apple computers. Later it expanded to also manage iPhones and iPads. The company launched at a time when most IT pros had few choices for managing Macs in a business setting.
Jamf changed that, and as Macs and other Apple devices grew in popularity inside organizations in the 2010s, the company’s offerings grew in demand. Notably, over the years Apple has helped Jamf and its rivals considerably, by building more sophisticated tooling at the operating system level to help manage Macs and other Apple devices inside organizations.
Jamf raised approximately $50 million of disclosed funding before being acquired by Vista Equity Partners in 2017 for $733.8 million, according to the S-1 filing. Today, the company kicks off the high-profile portion of its journey toward going public.
Apple device management takes center stage
In a case of interesting timing, Jamf is filing to go public less than a week after Apple bought mobile device management startup Fleetsmith. At the time, Apple indicated that it would continue to partner with Jamf as before, but with its own growing set of internal tooling, which could at some point begin to compete more rigorously with the market leader.
Other companies in the space managing Apple devices besides Jamf and Fleetsmith include Addigy and Kandji. Other more general offerings in the mobile device management (MDM) space include MobileIron and VMware Airwatch among others.
Vista is a private equity shop with a specific thesis around buying out SaaS and other enterprise companies, growing them, and then exiting them onto the public markets or getting them acquired by strategic buyers. Examples include Ping Identity, which the firm bought in 2016 before taking it public last year, and Marketo, which Vista bought in 2016 for $1.8 billion and sold to Adobe last year for $4.8 billion, turning a tidy profit.
Inside the machine
Now that we know where Jamf sits in the market, let’s talk about it from a purely financial perspective.
Jamf is a modern software company, meaning that it sells its digital services on a recurring basis. In the first quarter of 2020, for example, about 83% of its revenue came from subscription software. The rest was generated by services and software licenses.
Now that we know what type of company Jamf is, let’s explore its growth, profitability and cash generation. Once we understand those facets of its results, we’ll be able to understand what it might be worth and if its IPO appears to be on solid footing.
We’ll start with growth. In 2018 Jamf recorded $146.6 million in revenue, which grew to $204.0 million in 2019. That works out to an annual growth rate of 39.2%, a more than reasonable pace of growth for a company going public. It’s not super quick, mind, but it’s not slow either. More recently, the company grew 36.9% from $44.1 million in Q1 2019 to $60.4 million in revenue in Q1 2020. That’s a bit slower, but not too much slower.
Turning to profitability, we need to start with the company’s gross margins. Then we’ll talk about its net margins. And, finally, adjusted profits.
Gross margins help us understand how valuable a company’s revenue is. The higher the gross margins, the better. SaaS companies like Jamf tend to have gross margins of 70% or above. In Jamf’s own case, it posted gross margins of 75.1% in Q1 2020, and 72.5% in 2019. Jamf’s gross margins sit comfortably in the realm of SaaS results, and, perhaps even more importantly, are improving over time.
Getting behind the curtain
When all its expenses are accounted for, the picture is less rosy, and Jamf is unprofitable. The company’s net losses for 2018 and 2019 were similar, totaling $36.3 million and $32.6 million, respectively. Jamf’s net loss improved a little in Q1, falling from $9.0 million in 2019 to $8.3 million this year.
The company remains weighed down by debt, however, which cost it nearly $5 million in Q1 2020, and $21.4 million for all of 2019. According to the S-1, Jamf is sporting a debt-to-equity ratio of roughly 0.8, which may be a bit higher than your average public SaaS company, and is almost certainly a function of the company’s buyout by a private equity firm.
But the company’s adjusted profit metrics strip out debt costs, and under the heavily massaged adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) metric, Jamf’s history is only one of rising profitability. From $6.6 million in 2018 to $20.8 million in 2019, and from $4.3 million in Q1 2019 to $5.6 million in Q1 2020, with close to 10% adjusted operating profit margins through YE 2019.
It will be interesting to see how the company’s margins will be affected by COVID-19, with financials during the period still left blank in this initial version of the S-1. The Enterprise market in general has been reasonably resilient to the recent economic shock, and device management may actually perform above expectations, given the growing push for remote work.
Completing the picture
Something notable about Jamf is that it has positive cash generation, even if in Q1 it tends to consume cash that is made up for in other quarters. In 2019, the firm posted $11.2 million in operational cash flow. That’s a good result, and better than 2018’s $9.4 million of operating cash generation. (The company’s investing cash flows have often run negative due to Jamf acquiring other companies, like ZuluDesk and Digita.)
With Jamf, we have a SaaS company that is growing reasonably well, has solid, improving margins, non-terrifying losses, growing adjusted profits and what looks like a reasonable cash flow perspective. But Jamf is cash poor, with just $22.7 million in cash and equivalents as of the end of Q1 2020 — some months ago now. At that time, the firm also had debts of $201.6 million.
Given the company’s worth, that debt figure is not terrifying. But the company’s thin cash balance makes it a good IPO candidate; going public will raise a chunk of change for the company, giving it more operating latitude and also possibly a chance to lower its debt load. Indeed Jamf notes that it intends to use part of its IPO raise to “to repay outstanding borrowings under our term loan facility…” Paying back debt at IPO is common in private equity buyouts.
So what?
Jamf’s march to the public markets adds its name to a growing list of companies. The market is already preparing to ingest Lemonade and Accolade this week, and there are rumors of more SaaS companies in the wings, just waiting to go public.
There’s a reasonable chance that as COVID-19 continues to run roughshod over the United States, the public markets eventually lose some momentum. But that isn’t stopping companies like Jamf from rolling the dice and taking a chance going public.
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Fivetran snares $100M Series C on $1.2B valuation for data connectivity solution
A big problem for companies these days is finding ways to connect various data sources to their data repositories, and Fivetran is a startup with a solution to solve that very problem. No surprise then that even during a pandemic, the company announced today that it has raised a $100 million Series C on a $1.2 billion valuation.
The company didn’t mess around, with top flight firms Andreessen Horowitz and General Catalyst leading the investment, with participation from existing investors CEAS Investments and Matrix Partners. Today’s money brings the total raised so far to $163 million, according to the company.
Martin Casado from a16z described the company succinctly in a blog post he wrote after its $44 million Series B in September 2019, in which his firm also participated. “Fivetran is a SaaS service that connects to the critical data sources in an organization, pulls and processes all the data, and then dumps it into a warehouse (e.g., Snowflake, BigQuery or RedShift) for SQL access and further transformations, if needed. If data is the new oil, then Fivetran is the pipes that get it from the source to the refinery,” he wrote.
Writing in a blog post today announcing the new funding, CEO George Fraser added that in spite of current conditions, the company has continued to add customers. “Despite recent economic uncertainty, Fivetran has continued to grow rapidly as customers see the opportunity to reduce their total cost of ownership by adopting our product in place of highly customized, in-house ETL pipelines that require constant maintenance,” he wrote.
In fact, the company reports 75% customer growth over the prior 12 months. It now has more than 1,100 customers, which is a pretty good benchmark for a Series C company. Customers include Databricks, DocuSign, Forever 21, Square, Udacity and Urban Outfitters, crossing a variety of verticals.
Fivetran hopes to continue to build new data connectors as it expands the reach of its product and to push into new markets, even in the midst of today’s economic climate. With $100 million in the bank, it should have enough runway to ride this out, while expanding where it makes sense.
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