Snowflake IPO: software developer reaches record market value
Snowflake, a software development company, has begun a public offering process. In the process, its market value increased by $3.4 billion. As a result of this IPO Snowflake managed to achieve record levels of capital raising among U.S. software companies. The price of the developer’s share at the beginning of trading was 245 dollars, and by the closing of the exchange it was being sold at 253 dollars per share. The company has placed 28 million securities on the market, among the buyers are the investment fund, which was founded by Warren Buffet.
Initially, the market value of Snowflake was at $67.9 billion, and by the close of trading it had grown to $70.4 billion. This figure is 5 times higher than the developer’s estimate in February last year, when its price was $12.4 billion. Thanks to the IPO, the company managed to attract 3.4 billion dollars, and the management of Snowflake planned to get 2.7 billion dollars.
Such results are record-breaking for software developers. Since 2007, the leader of the segment was VMware, which in the process of listing received about $ 1 billion.
Snowflake was founded in 2012 and offers products for fast analysis and processing of large data sets. The company’s annual revenue is $500 million, and in just 6 months of 2020 it increased by 130%.
According to some sources, a large number of shares were acquired by the Berkshire Hathaway Foundation and Salesforce. They bought the securities for a total of 250 million dollars.
Before the public offering, Snowflake’s management estimated the price of the share at $120, and analysts at $80-100 per share. However, the price at the opening of trading exceeded these forecasts. After that the Berkshire Hathaway Foundation made another deal to acquire about 4 million shares of the company.
According to experts, the popularity of cloud solutions developers continues to grow. During the pandemic and quarantine restrictions, this segment has become extremely popular, and the cost of such giants as Amazon, Datadog, PayPal, went up sharply. However, Snowflake is the first company that decided to enter the IPO at this time of year. This public offering has become the largest in the U.S. since entering the Uber market in the spring of 2019. Then the cab service managed to get 8.1 billion dollars.
Snowflake products help to simplify the work with different data, the technology brings them together in a single program. Solutions from a developer allow you to work with different types of information, analyze and share them.
