As the pandemic propels the cloud market to new heights, cloud-data startup Snowflake is going public amidst a flurry of listings from private cloud companies.
On Wednesday, investors agreed to purchase 28 million shares of Snowflake stock at $120, a significant increase from last week’s expected price range of $75 to $85 a share. This follows a private backing where Warren Buffett’s Berkshire Hathaway and Salesforce each agreed to purchase $250 million in stock.
Snowflake distinguishes itself as a “data warehouse built for the cloud”, filling a gap in the market left by an explosion in data volumes, and the inability of on-premises systems to rapidly combine multiple data sources and deliver fast insights. With Snowflake, firms can dump all of their data into a single system, where it can quickly be processed to drive better decision-making.
“Legacy architectures are crumbling under the demand for analytics” said Snowflake CEO Frank Slootman in a presentation. “Snowflake has a multi-cluster shared data architecture that effectively removes limitations, allowing users to spin up and down ‘virtual warehouses’ that flexibly adapt to fit any given workload.”
This unique architecture has helped Snowflake act as both a competitor to major enterprise platforms like Google Cloud, Amazon Web Services and Microsoft Azure, and as a partner-selling infrastructure services as a cloud supplier.
Snowflake is one of several cloud software companies pushing into the public market as enforced social distancing speeds the transition away from on-premises systems.
Cloud DevOps platform JFrog raised the price range of its stock offering on Monday, which is expected to start trading this week. Cloud Analytics software firm Sumo Logic is set to price its offering on Wednesday, and next week, the listing continues as cloud task-management software firm Asana sets its own price.
Snowflake however, will be the largest of all. At a price of $120 per share, Snowflake carries a valuation of at least $33 billion – making it the biggest ever public listing for a U.S. software company.
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