Sid Sijbrandij, CEO of GitLab, at a company event in London
GitLab
GitLab CEO Sid Sijbrandij, fresh out of an employee stock sale that valued his software start-up at $ 6 billion, said he still wants to go public, although he is looking at many more options than were available in the past.
Sijbrandij on Thursday confirmed CNBC’s late November report on the company’s valuation of its secondary offering, which allowed employees to sell up to 20% of their acquired equity. He provided additional details about the size of the business and investors, as well as revenue growth and new customers.
GitLab’s cloud-based software is used by developers to share code and collaborate on projects. The company, which competes with Microsoft’s GitHub and Atlassian, has seen a boom in demand, as more sectors have come to rely on software and digital tools to run their operations. GitLab specializes in helping programmers to streamline product updates, reducing operating costs and accelerating development.
GitLab reached $ 150 million in annual recurring revenue, said Sijbrandij, after experiencing 74% growth in the last quarter. During 2020, the company signed three major airlines and a travel management provider, even when the travel industry was forced to make drastic cuts because of the pandemic.
“It was the industry hardest hit last year and they still bought it,” said Sibrandij. “It has been a difficult year for many of our customers.”
In its “team handbook” on its website, GitLab had openly stated its plan to go public by November 2020. After the pandemic hit early last year, shaking the economy in general, the company ruled out the time to its debut, indicating that the listing was still in the script.
Sijbrandij said he went to high school to “give our team members the opportunity to benefit from the value we create together”. The $ 6 billion valuation is higher than the $ 2.7 billion in the late 2019 financing round.
GitLab allowed current and former employees with acquired capital to sell a combined total of 4.9 million shares, bringing the total offering to $ 195 million. Investors who bought the shares included Alta Park, HMI Capital, OMERS Growth Equity, TCV and Verition. For the transaction, GitLab used the Nasdaq Private Market, which specializes in helping private companies provide secondary liquidity.
Sijbrandij said there is no timetable for a public market debut, although people familiar with the matter told CNBC in November that it was likely to happen in 2021. The company has several ways to consider going public that did not exist or were relatively not tested before last year.
One option is direct listing, the path taken by Spotify, Slack, Palantir and Asana and being pursued by Roblox, which allows employees to sell shares to new investors immediately. Other companies, such as Unity, Airbnb and DoorDash, have chosen a hybrid auction that allows management to choose a price based on the bid. And there is the opportunity to go public through a special purpose acquisition company (SPAC), or a reverse merger conducted by an entity called a blank check.
“There are many more options and we are following the market,” said Sijbrandij. SPACs present an “interesting alternative that is also on our radar,” he said.
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