Filing IPO, HashiCorp Reports $ 212 Million in Annual Revenue and Rapid Growth
HashiCorp Inc., the maker of popular open source tools used by organizations to automate their IT infrastructure, today deposit for an initial public offering.
Like other enterprise tech companies that have moved to list their stocks in recent quarters, HashiCorp is unprofitable but is showing rapid revenue growth. HashiCorp increased its sales from $ 121.3 million in the 12 months ended Jan.31, 2020 to $ 211.9 million through Jan.31 of this year.
The increase represents a jump of 75%. The company’s losses, meanwhile, fell from $ 53.4 million to $ 83.5 million.
HashiCorp’s financial results improved for the six-month period ended July 31. The company reduced its losses from $ 67.3 million a year ago to $ 40.5 million while maintaining steady revenue growth, increasing sales in the first two quarters of the year to $ 142 million of dollars.
“We expect to experience net losses for the foreseeable future as we continue to invest in the market opportunity that lies ahead,” HashiCorp told investors in its IPO filing. This opportunity, according to the startup, consists of a total addressable market worth $ 41.7 billion this year and is expected to nearly double to reach $ 72.5 billion by 2026.
HashiCorp provides a set of popular open source tools designed to reduce much of the manual labor historically involved in maintaining a company’s infrastructure and applications. The startup estimates that its software has been downloaded around 100 million times since the start of the year alone. Globally, HashiCorp estimates that at least 11,000 organizations have downloaded any of its products at any given time.
HashiCorp the flagship tool is Terraform, an infrastructure as code product. Terraform allows administrators to define the configuration of the cloud and on-premises IT infrastructure by writing scripts instead of navigating through management consoles. The tool automatically implements the configuration details defined in a script, eliminating the need for administrators to manually configure each setting.
Terraform and competing infrastructure automation tools have become popular in recent years as modern enterprise technology environments contain too many components for manual configuration to be practical. HashiCorp says Terraform can save administrators weeks of work in some cases.
Reducing the risk of human error is another key part of the startup’s value proposition. The fewer configuration parameters to set manually, the less risk of human error.
HashiCorp’s other open source tools also focus on automating key aspects of running enterprise IT environments. One tool, called a Vault, helps organizations store sensitive application data such as encryption keys that a workload uses to protect business records. Consul is HashiCorp’s product for automating network management, while an application scheduler called Nomad is provided by the startup to reduce the amount of work required to deploy and manage workloads.
HashiCorp also offers products for more specialized tasks, such as setting up development environments in which a company’s programmers create new software.
The startup makes money from its tools, which are all provided under an open source license, by selling commercial editions that offer additional functionality. HashiCorp also offers a subset of its tools through a managed cloud service called the HashiCorp Cloud Platform.
In the six months to July 31, 2021, clients with contracts worth at least $ 100,000 per year accounted for 87% of HashiCorp’s revenue. The large number of high value-added contracts reflects the fact that startup tools are increasingly popular with companies. HashiCorp told investors in the IPO filing that its existing business installed base is expected to offer significant growth opportunities.
“Our customer base represents a significant growth opportunity as we activate their cloud adoption journeys,” explained HashiCorp. “As the adoption of the cloud continues and our customers look to build more scalable and dynamic cloud architectures, they are likely to shift from adopting bare-essential use cases to more complex deployments, expanding their use of life. ‘a given product. “
HashiCorp also contends that many other organizations could join its installed base in the future. “We believe that almost all organizations will adopt a cloud strategy, which will translate into a substantial opportunity to continue to grow our customer base,” said the startup. “We intend to continue to invest significantly in research and development and to hire the best technical talent to enable new use cases and increase the differentiation of our products. “
HashiCorp will be listed on the New York Stock Exchange under the symbol “HCP”. The startup’s brief sets the fundraising goal for the offering at $ 100 million, a number that is often used by tech companies until they finalize their IPO plans.