SentinelOne is the second cybersecurity company to go for an initial public offering this year, revealing rising sales, losses that are piling up, and a channel-first selling method. The company said those channel partners brought in 96% of its revenue in the fiscal year ended January 31, 2021.
That is up from 92% of revenue in the fiscal year 2020. SentinelOne’s solution provider focus has led to skyrocketing sales and more service engagements for partners, as the company looks to raise as much as $100 million on the New York Exchange public offering.
In a 180-page filing done late Thursday with the US Securities and Exchange Commission, the company said that all the sales are substantially filled through channel partners, including distributors and resellers, OEMs, MDRs, MSPs, MSSPs, and IR firms.
The expectation is that the revenue will continue to significantly come from channel partners for the foreseeable future.
SentinelOne is going to use the net proceeds of the IPO for general corporate purposes, including general and administrative functions, product development, and capital expenditure. The company also said that some of the proceeds will be used to acquire or invest in the relevant tech solutions and business.
The road ahead
In recent years, SentinelOne has experienced major growth, according to the filing, with sales going from $93.1 million on the most recent fiscal year, up 100+%, from the $46.5 million from fiscal 2020. Its losses surged to $117.6 million in fiscal 2021 (about $3.31 per share), a loss of 53.6% worse than the loss of $76.6 million (about $2.34 per share) in fiscal 2020.
In the filing, the company wrote that it expects the operating expenses to increase in the future, as it continues to pour money into growth, the expansion of its research and development arm, the expansion of sales and marketing, and finally expansion into adjacent markets.