In its NASDAQ launch on Thursday, Confluent, the data analytics provider that LinkedIn spun off in 2014, rose by 25%, giving the business a market cap of $11.4 billion.
With the sale of 23 million shares at $36 apiece, beyond the anticipated range of $29 to $33, Confluent raised $828 million in the offering. The stock’s closing price was $45.02, and it trades under the ticker “CFLT.”
Confluent’s software monitors all of the internal business activities, such as new sales, orders, trades, and client responses. It also filters real-time insights into the databases of the company. The demand for Confluent’s data streaming technologies has risen, with businesses growing more complicated in shifting data to different clouds and on-premises servers.
The prospectus states that revenue increased by 58 percent last year to $236.8 million. However, stock-based compensation increased significantly and R&D spending increased by 81 percent, resulting in a $229.8 million net loss, up from $95 million in 2019.
Confluent is based on Apache Kafka, an open-source platform developed by Jay Kreps, Jun Rao, and Neha Narkhede inside of LinkedIn in 2011. In 2014, the group spun out Confluent as a separate startup, with an investment of roughly $500,000 from LinkedIn, after deploying the technology internally for data streams.
Confluent commercializes the program, delivering all of its features and running it across any of the major clouds or in a company’s own data center, whilst Kafka continues to be a free open-source item that Google, Microsoft, or Amazon could run as a service. Kafka is thought to have been utilized by more than 70% of Fortune 500 organizations, according to Confluent’s prospectus. According to Confluent’s website, some of its clients are Walmart, Citigroup, Humana, and Intel.
The most recent open-source technology-based business to reach an IPO size is Confluent. The 2017 launch of the database platform MongoDB has resulted in a $24 billion valuation for it. A year after going public, Elastic, which commercializes open source solutions for business searches, has a market worth of $13 billion.