General IPO
June 3, 2021
6 minutes read

Markets: LinkedIn Spinout Confluent Files For IPO

Confluent, a data software company spun out of LinkedIn, has filed for an initial public offering. It has unveiled its…

Confluent, a data software company spun out of LinkedIn, has filed for an initial public offering. It has unveiled its S-1 filing with the US SEC, showing its plans to list on the Nasdaq stock market.

Confluent sells software that developers can use to quickly move around data for use inside applications. Its software is based on the open-source Apache Kafka framework.

Confluent started inside of LinkedIn where the Apache Kafka framework was developed. It spun out of the Microsoft-owned company in 2014.

Many companies have built strong businesses around open-source software and Confluent is the latest in that prospect. Its S-1 filing shows that of a healthy company with fast-growing revenues.

By the Numbers

Confluent had $237mn in revenue in 2020, up from $150mn in 2019. In the three months ended March 31, 2021, the company had $77mn in sales, up 51% year-over-year.

Confluent isn’t profitable on a net basis but at least has fast-growing sales to justify its losses. It reported respective net losses of $95mn and $230mn in 2019 and 2020.

Confluent reports having 2,500+ enterprise customers, including 560 each paying at least $100k annually and 60 each paying at least $1mn.

Highlights

Confluent is a major success in its right. It’s a seven-year-old startup that’s grown rapidly on the backs of nearly $500mn in venture funding. That venture funding has helped the company sustain itself as it racked up losses due to big growth investments.

Confluent was valued at $4.5bn from its most recent funding round in April 2020. Its investors include Benchmark Capital (15.3% pre-IPO stake), Index Ventures (13%), and Sequoia Capital (9.3%).