Snowflake IPO becomes largest software placing in NYSE history

Snowflake's Initial Public Offering (IPO) today has become the largest software listing in the New York Stock Exchange's history, raising $3.4 billion at a valuation of more than $33 billion.

The cloud data platform placed 28 million shares at $120 per share, after a surge in investor demand. The offering is expected to close on 18 September.

In recent years, the Californian company has built up quite a war chest, raising $450 million in a Series F in late 2018, followed by a $479 million Series G in February - which valued it at $12.5 billion.

More than 2,000 customers deploy Snowflake to help derive insights from all their data. What it calls the "only data warehouse built for the cloud" aims to give instant, secure and governed access, with a core architecture to enable many types of data workloads, including a single platform for developing modern data applications.

It can be run on Amazon Web Services, Microsoft Azure or Google Cloud, priced on a per-second usage model.

Despite its rapid growth - reported as 121 per cent year-on-year during the second quarter - the company is not yet profitable, with net losses of $178 million in 2019 and $348.5 million in 2020.

Looking deeper into Snowflake's regulatory filing, it listed potential risks like a reliance on the cloud hyperscalers for infrastructure. “Our platform currently operates on public cloud infrastructure provided by AWS, Azure and GCP, and our costs and gross margins are significantly influenced by the prices we are able to negotiate with these public cloud providers, which in certain cases are also our competitors.”

As companies begin to break down data silos, Snowflake's prospectus laid out its plan for domination, leaning heavily on the fact that it avoids the vendor lock-in that is inherent with similar offerings from the existing cloud players.

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