CrowdStrike, the US-based endpoint protection software provider backed by internet and technology conglomerate Alphabet, cloud services provider RackSpace and telecommunications company Telstra, will raise $612m when it goes public today.
The company is issuing 18 million shares on the Nasdaq Global Select Market priced at $34.00 each, higher than the $28 to $33 range it set last week. Those terms had been increased from a $19 to $23 range it had originally determined late last month.
The underwriters have a 30-day option to buy a further 2.7 million shares, which would lift the size of the offering to approximately $704m. CrowdStrike will be valued at approximately $6.82bn when it floats.
Founded in 2011, CrowdStrike has built an artificial intelligence-equipped, cloud-based cybersecurity platform that detects and prevents cyber attacks at the endpoint, on laptops and desktops as well as servers and connected devices.
The company’s net loss increased slightly to $140m in the year running up to the end of January 2019, but it more than doubled revenue to almost $250m over the same stretch of time.
CrowdStrike had received more than $480m of funding pre-offering, including a $100m series C round in 2015 led by CapitalG, the Alphabet subsidiary then known as Google Capital, and backed by RackSpace, venture capital firm Accel and private equity firm Warburg Pincus.
The series C investors joined Telstra and investment firm March Capital Partners for a 2017 series D round that was $131m in size according to the IPO filing, and which valued CrowdStrike at more than $1bn.
The company added $200m in a June 2018 series E round co-led by Accel, growth equity firm General Atlantic and VC firm IVP, which invested alongside CapitalG and March Capital Partners.
The IPO consists solely of class A shares, which are worth the same as the almost 183 million class B shares owned by CrowdStrike’s shareholders, except with a fraction of the voting rights.
CapitalG’s 11.1% stake is set to be diluted to 9.6% in the offering. CrowdStrike’s largest shareholders, Warburg Pincus and Accel, will come out with 26.1% and 17.5% respectively.
The offering’s lead book-running managers are Goldman Sachs, JP Morgan, BofA Merrill Lynch and Barclays, while Credit Suisse, Jefferies, RBC Capital Markets, Stifel, HSBC, Macquarie Capital, Piper Jaffray and SunTrust Robinson Humphrey are book-running managers.
BTIG, JMP Securities, Mizuho Securities, Needham & Company and Oppenheimer are co-managers for the IPO.
