Endpoint Security Company CrowdStrike Files Publicly for IPO
CrowdStrike, the cybersecurity company that identified the two Russian government-linked hacker groups that invaded the Democratic National Committee (DNC)’s network during the 2016 presidential campaign, filed publicly for an initial public offering on Tuesday.
Sunnyvale, CA-based CrowdStrike sells cloud-based security software and related services by subscription to businesses. Founded in 2011, the company adapted traditional data security safeguards by monitoring not only computers in customer data centers but also the laptops, smartphones and other devices that employees increasingly use outside the workplace. In addition to this endpoint security approach, CrowdStrike offers more comprehensive services, including threat intelligence and incident response.
CrowdStrike reported revenue of nearly $250 million for its 2019 fiscal year, which ended January 31. Its net loss was $140.1 million for that year. The firm says it has 2,516 subscription customers worldwide, including Fortune 100 companies and major banks.
In its prospectus, CrowdStrike says it plans to expand its international customer base, seek business from US government agencies, and persuade its existing customers to increase their utilization of its services.
The company has reported steadily increasing revenue over the past three years, while its net loss also rose as it invested in growth. In fiscal year 2017, CrowdStrike had revenue of $52.7 million and lost $91.3 million. The following year, revenue rose by 125 percent to $118.8 million, and the net loss was $135.5 million.
CrowdStrike has raised a total of $481 million from investors including Accel, March Capital Partners, General Atlantic, Institutional Venture Partners (IVP), and Capital G, the venture fund of Google parent company Alphabet, according to Crunchbase. At the time of its last fundraising in June, the company said it was valued at more than $3 billion, Venturebeat reported.
CrowdStrike is vying with a thicket of competitors in a global cybersecurity market that is projected to generate $124 billion in spending in 2019, according to research firm Gartner. The company says its rivals range from established security giants McAfee, and Symantec to Cylance and Carbon Black—which also offer endpoint security software— as well as network security companies such as Palo Alto Networks and FireEye.
CrowdStrike plans to list its Class A common stock on the Nasdaq exchange under the symbol “CRWD.” In this first prospectus filed publicly, which will be updated later to include deal details such as the IPO price per share, the company pegs the maximum value of the offering at $100 million. But this is often a placeholder figure used by pre-IPO companies that will later revise it.