by Chris Metinko, Troy Hooper, Thomas Zadvydas and Mark Andress
Last year saw some big exits for venture capital-backed technology companies. GitHub sold to Microsoft for $7.5 billion and Duo Security sold to Cisco Systems in a $2.35 billion deal, while Docusign, Dropbox and Zscaler all hit the public markets to reward investors.
What will 2019 hold? Here is Mergermarket’s exclusive list of startups most likely to see a liquidity event in 2019.
Acquia
The Boston-based enterprise software and IT services company has been considering an IPO since at least 2014 and 2019 could be the year it pulls the trigger. The company generated $169 million in 2017 annual revenue, according to Inc magazine.
Airbnb
The San Francisco-based online lodging marketplace has been making strides toward an IPO, and reports have suggested it aims to be ready in June. Since at least 2017, Airbnb has been working to instill more robust financial reporting systems, strengthen account security measures and improve organizational compliance to prepare itself as a public company. The company was last valued at $31 billion in a 2017 fundraising round.
AvidXchange
The Charlotte, North Carolina-based payments company — reportedly valued at $1.2 billion after an equity infusion of $300 million in 2017 — has been making acquisitions to expand into different verticals. At a CBS Insights conference in June 2018, CEO Michael Praeger said an IPO could be the next step for AvidXchange, which has been adding executives to its C-suite in preparation for a potential listing. Two payment software peers, Adyen and Ceridian, went public in 2018.
Cloudflare
The San Francisco-based company is working on an initial public offering that may be launched in the first half and could value the company at more than $3.5 billion, Reuters reported in October. Cloudflare competes in the web application firewall segment, which saw a flurry of deals in late 2018, with Thoma Bravo buying Imperva and Rapid7 acquiring tCell.io in October.
CrowdStrike
The Sunnyvale, California-based endpoint security company — valued at $3 billion following a funding round last summer — has reportedly engaged Goldman Sachs to ready the business for an IPO as early as the first half. Endpoint competitor Carbon Black made it to the public markets in 2018, but the sector also has been attractive to strategic acquirers.
Databricks
The San Francisco-based software company is aiming for IPO-ready financials in late 2019 while taking as much market share as possible in big data processing, CEO Ali Ghodsi said last April. Its Unified Analytics Platform helps businesses process big data in the cloud using machine learning algorithms. Founded in 2013, Databricks has raised $247 million, most recently $140 million in Series D funding in August 2017 led by Andreessen Horowitz.
FinancialForce
The San Francisco-based company continues to put the personnel and accounting procedures in place for an IPO in 24 months or less, CMO Fred Studer told Mergermarket in October. FinancialForce already has annual revenue of more than $100 million.
InsideSales
The sales technology developer had a relatively quiet 2018, but now, as it celebrates its 14th anniversary, 2019 could be an important year for the company. While it was valued at about $1.5 billion after its last capital raise in January 2017, investors such as Microsoft and Salesforce.com could see now as the time to pull the trigger on a deal.
Looker
The Santa Cruz, California-based data platform raised a $103 million Series E in December at a reported $1.6 billion valuation. CEO Frank Bien, however, said the round does not eliminate the possibility of an IPO in 2019. The company has yet to talk to potential underwriters but Looker continues to put pieces in place for an IPO, filling key positions and adding board members, Bien said.
Lyft
The San Francisco-based ride-hailing service last month announced it had filed confidential documents with the US Securities and Exchange Commission for an IPO. In a bid to beat rival Uber to the markets, Lyft could make its market debut as early as the first quarter, depending on the speed of the SEC’s review, according to media reports. One source cited by Reuters said Lyft is likely to be valued at $20 billion to $30 billion.
Medallia
The Palo Alto, California-based company could be the next enterprise feedback software firm to follow SurveyMonkey to the public markets. It has held talks with investment bankers about an IPO early this year. Medallia could become a takeover target before it goes public, as happened to peer Qualtrics, which SAP acquired.
Netskope
The Santa Clara, California-based cloud access security broker (CASB) received $168.7 million in a Series F funding in November at a valuation of more than $1 billion. CEO Sanjay Beri said the company will remain independent, but the CASB space has seen a lot of consolidation in recent years. Last year, one of Netskope’s biggest competitors, Skyhigh Networks, was bought by cybersecurity giant McAfee for an undisclosed amount.
OneLogin
The San Francisco-based company could be the next identity management player to see an exit. Interest in the space was clear this summer with Thoma Bravo acquiring Santa Clara, California-based Centrify in July for an undisclosed amount, followed by Cisco Systems buying Ann Arbor, Michigan-based cybersecurity company Duo Security in August.
Palantir Technologies
The Palo Alto, California-based data analytics company reportedly has held discussions with bulge bracket banks about an IPO in the second half of this year or in early 2020. Given Palantir’s large number of government and military contracts, it was long thought the Peter Thiel-founded company would eschew the public spotlight. But it has reportedly reevaluated that option to create liquidity for employees and other shareholders. Valued at $20 billion in a 2015 funding round, it could also seek a partial or full sale.
Postmates
Bastian Lehmann, founder and chief executive of the San Francisco-based food-delivery platform, told Fortune in a September interview that Postmates has a “beautiful path to an IPO in 2019.” That same month, Tiger Global Management led a $300 million funding round that valued Postmates at almost $1.2 billion.
Quantum Metric
The website analytics and performance tracking company could sell in 2019 or 2020, CEO Mario Ciabarra said in November. Potential buyers of the Monument, Colorado-based company include Salesforce and Oracle, which could fold it into their CRM platforms. It may also attract cloud computing players.
Rubrik
The Palo Alto, California-based data management company has raised $292 million in four rounds of funding, and it added a new chief financial officer, chief legal officer and chief people officer in 2018. CEO Bipul Sinha is on record saying Rubrik’s ultimate goal is to become a public company.
ScienceLogic
The Reston, Virginia-based IT company could explore an exit in late 2019 as it approaches profitability, CFO Pat McCoy said in November. The company, which provides artificial intelligence solutions for enterprises and federal agencies, has attracted interest from undisclosed strategic buyers. These parties might be current clients integrating ScienceLogic’s product into their own maintenance and networking systems, like Cisco or Tata Consulting Group.
Slack Technologies
The San Francisco-based enterprise messaging company has been putting systems and staff in place for a 2019 IPO. Slack’s IPO could come as early as the first quarter, The Wall Street Journal reported in September. Goldman Sachs has been selected to lead the offering, Reuters reported in December, adding that Slack could achieve a valuation of more than $10 billion.
Snowflake Computing
The San Mateo, California-based company is eyeing an eventual IPO, CFO Thomas Tuchscherer said in October. The cloud data warehouse — valued at $3.5 billion after raising $713 million last year — expects to quadruple revenue for its fiscal year ending this month.
Sumo Logic
After the machine data analytics platform netted $75 million in Series F funding in 2017, CEO Ramin Sayar said an IPO was the next logical step. A source said that investors would probably compare Redwood City, California-based Sumo Logic with high-flying competitor Splunk. But an acquisition can’t be counted out either. In 2018, two competitors, LogRhythm and Loggly, were bought by Thoma Bravo and SolarWinds, respectively, for undisclosed prices.
Tanium
The Emeryville, California-based company has been looking at an IPO since late 2017. The endpoint security company raised $200 million in October, and reported billings of more than $270 million. It could look to follow competitor Carbon Black — which had an IPO last May — into the public market. Or perhaps it will sell like peer Cylance did to Blackberry in November for $1.4 billion.
Turbonomic
The Boston-based workload automation software company engaged in acquisition discussions with Cisco Systems in 2017, according to The Information. A deal never materialized but Cisco’s interest could be renewed in 2019, or another bidder may surface.
Uber
San Francisco-based Uber reportedly filed confidential paperwork for a public listing on the same day last month as rival Lyft. It sets the stage for one of the largest IPOs ever. In February 2018, CEO Dara Khosrowshahi said it was doubtful Uber would be ready to go public in this year’s first half, but it would “probably” be ready for an IPO in the second half. More recent media reports have said Uber’s IPO could come as soon as the first quarter.
Chris Metinko, based in San Francisco, and Thomas Zadvydas, based in New York, are reporters covering technology, media and telecommunications for Mergermarket and Dealreporter. Troy Hooper is Los Angeles editor and Mark Andress is San Francisco editor for the publications.
