The company will push for a large offering in order to compete with Snowflake and Google.
San Francisco-based Databricks is planning a massive IPO for 2021, according to the company’s CEO, Ali Ghodsi. He explained the latest news on the public offering in a recent interview.
As we reported last year, rumours of a Databricks IPO in 2021 have been circulating for some time. Bloomberg reported then that the company is aiming to go public at a price significantly higher than the valuation in its last funding round. The company was valued in 2019 at $6.2 billion when it raised $400 million, according to a statement at the time.
Databricks competes in a similar space as market darling Snowflake. Both companies allow customers find the data to power the algorithms that help with a wide variety of business tasks. These can include everything from picking which products to order to which candidates to bring in for job interviews.
In addition to Snowflake, Databricks faces increasing competition from Google’s BigQuery.
Keeping the process in-house from a CEO perspective
Many startups bring on a specialist CEO to shepherd the company through the public offering process. This will not be the case with Databricks.
“These professional CEOs very rarely are good at that because they don’t really understand the products that your company is selling,” Ghodsi said. He believes that his detailed knowledge of the company and its offerings is an advantage.
Stabilising revenues is key, he believes, to having a successful public offering.
“There’s a lot of compliance that goes into it,” he told Protocol. “Much of it is making sure that we have that predictability that you need when you IPO.”
2021 will be a good year for Databricks
The company plans some significant product announcements for 2021. Databricks looks to capitalize on its fastest growing industry sectors, including health care.
“Databricks is behind the scenes of pretty much all the vaccines that are being talked about,” Ghodsi said. He added: “Health care providers are using it to track inventory and how crowded their hospitals are.”
That high-profile product momentum will be an asset as the company moves forward with with its plans to go public.
“It’s a really, really good IPO climate and we will be IPO-ready,” he said.