Cloud darling Hashicorp's IPO raises $1.22bn amid modest gains from a $80 start

Not great, not terrible

Cloud software biz Hashicorp hit the markets this week with an initial public offering priced at $80 per share after which its stock enjoyed a modest rise as investors cracked open their wallets.

The Nasdaq debut went ahead on Thursday, and the offer price valued the company at approximately $14bn. The 15.3 million shares of its Class A common stock were expected to result in gross proceeds of $1.22bn. At close yesterday, the stock was priced at just over $85, a bit below highs of $88 but comfortably above the IPO price.

2021 has had its fair share of tech IPOs. GitLab finally went public in September, attracting a price of $77, per share. It soared above $130 before dropping during November when investors took a bit of a reality check on the loss-making source shack.

Hashicorp is also familiar with reporting financial losses. In its prospectus filed with the Securities and Exchange Commission (SEC), it posted a net loss of $62.4m for the nine months ended 31 October 2021. For the same period the previous year, net loss stood at $76.6m.

Still, vanity dictates that the company would much rather point to its revenues, which reached $175.8m for those same nine months, compared with $118.5m the same time last year. Overall, Hashicorp reckoned the total addressable market for its products would hit $73bn by 2026.

San Francisco-based (although 90 per cent of employees are remote) Hashicorp was founded in 2012 and its key commercial products are Terraform for infrastructure provisioning, secrets management platform Vault, Consul for network management, and a scheduler and workload orchestrator, Nomad.

The company also offers its products as open source as well as paid. It claims 100 million open-source software downloads a year, and names the likes of Slack and Cloudflare as among those customers.

However, it is the whole multi-cloud and automation thing that will likely have grabbed the attention of investors, particularly as the march to the cloud is accelerated thanks to the ongoing pandemic. ®

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