Cloud data warehouse start-up Snowflake Inc’s shares doubled on Wednesday, raising more than US$3 billion in a blockbuster initial public offering (IPO) on the New York Stock Exchange.
Snowflake shares priced at US$120 at the opening bell finished the official trading day just shy of US$254.
The San Mateo, California-based company has grown quickly since it was founded eight years ago in Silicon Valley and was valued at about US$12.4 billion in a private funding round early this year, despite not being profitable.
Snowflake was valued at more than US$70 billion based on its share price on Wednesday.
“It’s surprising, but it’s a validation of our initial vision,” Benoit Dageville, one of the French cofounders of Snowflake, said in an interview.
“Snowflake IPOing as the world’s largest software IPO is showing that markets for enterprise software continue to be far larger than most anticipate,” Box cloud computing company chief executive Aaron Levie wrote on Twitter. “With exponential growth in data, devices, and apps, something already big today might be 100X bigger in just a few years.”
Snowflake revenue jumped to US$264.7 million last year from US$97 million the year before, while its net loss grew to US$348.5 million from US$178 million in that same comparison, according to a filing with the US Securities and Exchange Commission.
“Beginning with our first customers in 2014, the response was beyond our expectations as we addressed major shortcomings of existing solutions and expanded from a data warehouse into an integrated cloud data platform,” the start-up said in a regulatory filing.
Snowflake provides online data storage, analytics and management, essentially providing infrastructure as a service to businesses seeking to operate online.
It relies on data centers hosted by Amazon.com Inc, Google and Microsoft Corp, according to the filing.
While the COVID-19 pandemic is taking a toll on the economy, it is also accelerating a trend toward businesses connecting with customers online and relying on the cloud or remote work.
Snowflake reported having more than 3,100 customers at the end of July, including Adobe Systems Inc, Capital One Financial Corp and Sony Corp.
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