Big news came out this evening…and it’s the news we’ve all been anticipating for
quite some time. Snowflake has finally filed with the SEC for its IPO. I just wanted to
put together a quick video to update the community…because as you know, I already put out this week’s
edition of IPO This Week…and of course, this news didn’t come out until after I
put that video together. That’s just the way it is with IPOs, they keep me on my toes.
But I do want to thank you for tuning in twice to the channel in under 24 hours…and in
case you’re wondering, yes, I did a wardrobe change just for this video. Anyway, as we
get closer to the actual IPO, I’ll definitely put out a much more comprehensive video, but
for today, let’s just take a quick look at some of the highlights of the filing.
But before we do, it has crossed mind that some of you may not have heard of Snowflake,
so if you haven’t, it’s a company that has been around for 8 years and is one of
the leaders in cloud data warehousing. Its technology allows companies to store and manage
date in the cloud, which we know has been a huge and important growth area for its big
time competitors Microsoft and Amazon. Tech investors have eagerly awaited news of the
company filing its IPO papers since February and today’s news tells us that they finally
did. So what are some of the highlights in the
filing? Snowflake says it has 3,117 customers as of
July 31st of this year, including seven of the Fortune 10 and 146 of the Fortune 500
companies. The company is reporting significant growth
in recent years. For the fiscal years ended January 31 for both 2019 and 2020, their revenue
grew from $96.7 million in 2019 to $264.7 million in 2020, representing year-over-year
growth of 174%--not too shabby! And for the six months ended July 31 for both 2019 and
2020, revenue grew from $104.0 million to $242.0 million, representing year-over-year
growth of 133%. And gross margins are continuing to improve
as well. Again, for the fiscal years ended January 31, 2019 and 2020, the gross margin
improved from about 46% to 56%. And then for the six months ended July 31st for both 2019
and 2020, the gross margin grew from 49% to almost 62%...again, not too shabby!
Now keep in mind that the company is still not profitable with a net loss of $178.0 million
from the fiscal year ended January 31, 2019 ballooning up to $348.5 million for the fiscal
year ended January 31, 2020. However, when looking at the past two quarters, we do see
that they are beginning to burn less cash and that is something they want us to be aware
of as we approach the initial public offering. But there is no question that they are looking
at the IPO as an opportunity to obtain more capital so that they can continue growing
while still being unprofitable. From the filing, Snowflake states they plan to use the net
proceeds of the IPO for general corporate purposes, including working capital, operating
expenses, and capital expenditures. The company intends to list on the New York Stock Exchange
under the ticker SNOW, an easy one to remember. I’m interested in knowing if you plan to
invest in Snowflake or not, let us know in the comments.
Snowflake said it plans to raise $100 million in the filing, a figure which is typically
considered a placeholder and will almost definitely be updated in later filings. I will continue
to monitor the amended filings as they are released. And as the IPO becomes imminent,
I’ll put out a much more detailed video on the company, so stay tuned for that one
by making sure you’ve both subscribed to the channel and have that notification bell
turned on. And if you haven’t seen this week’s IPO This Week episode that I released
earlier today, definitely check it out to see what companies and SPACs are going public
this week and get some background information on all of them. I also shared in that video
something that I will repeat here….in celebration of the community growing to over 1,000 subscribers,
we are gonna have our first live stream this Thursday, August 27th at 8:30 PM eastern.
I have no idea how this is gonna go, but I’m always open to trying something new and I’m
looking forward to communicating with you in real-time in what should be a more personal
way. So this last full week of August has turned busy, but that’s fine by me.
As I call it wraps on a long day, please remember to like this video…it’s so important in
helping to continue to grow the channel. And with that, I hope to check in with you live
on Thursday…thanks again for watching, and until next time, have a great day!