The company’s shares shot up nearly 100% during its IPO.
On Wednesday, the cybersecurity company CrowdStrike had its initial public offering. The company saw its shares jump nearly 100% higher than its asking price of $34 per share. The shares did come down slightly but were still up 70% by the closing bell.
CrowdStrike raised $612 million, which makes it one of the biggest IPOs for a cybersecurity company. The IPO was led by Goldman Sachs, JPMorgan Chase, Bank of America, and Barclay’s.
Things to know about CrowdStrike
CrowdStrike was founded in 2011 and provides protection to stop data breaches for its business clients. Falcon, the company’s cloud-based solution, can detect a wide range of cyber threats.
The company is probably best known for uncovering the 2016 breach of the Democratic National Committee’s servers. It has made notable gains in the market, picking up customers like Amazon Web Services and Credit Suisse. According to CEO George Kurtz, the company is also looking to enter the government sector.
The cybersecurity market is a crowded field with competitors like FireEye, McAfee, Symantec, Cisco, and Microsoft. But according to Kurtz, CrowdStrike has the upper hand because it focuses on endpoint protection in the cloud.
Like many of the tech companies going public in 2019, CrowdStrike has yet to make a profit. But the company does continue to increase its revenue while minimizing its losses.
The company’s revenue reached an estimated $95 million in the first quarter of 2019, which is more than double what it earned a year earlier. And it lost about $26 million, which is down from $33 million a year earlier.
CrowdStrike is one of several tech companies that went public in 2019. And the results of these IPOs have been somewhat of a mixed bag. Zoom continues to perform well ever since its April IPO while Lyft and Uber’s shares have largely underperformed.
CrowdStrike’s heavy losses are concerning but the company’s revenue growth is impressive. Google’s parent company Alphabet invested $100 million in CrowdStrike’s IPO, which says a lot about the company’s future prospects.
According to Kurtz, the company plans to invest its proceeds from the IPO into furthering the capabilities of its platform and expanding internationally.