Cohesity Prepares (Again) For an IPO

Data management startup and Prime Unicorn Index component Cohesity is preparing to launch its initial public offering (IPO) soon, pending approval from its financial advisors, as stated by CEO Sanjay Poonen in a discussion with Business Insider. Cohesity, known for enabling companies to store backup data on cloud platforms like Microsoft Azure and Amazon Web Services, had previously attempted to go public. It confidentially filed for an IPO on December 21, 2021, but unfavorable market conditions, including high inflation, rising interest rates, and recession fears, hindered the plan.

However, the market may soon be receptive to IPOs again. Poonen is optimistic about Cohesity’s prospects, stating that the company is as prepared as it was in 2021 and will choose the right moment to go public, possibly in 2024.

Recently, Cohesity has made significant executive hires, including Eric Brown as Chief Financial Officer and Srinivasan Murari as Head of Engineering. The company has also expanded partnerships and product offerings, such as a new generative AI tool in collaboration with Google Cloud, Microsoft, and IBM. This tool can analyze backup data to summarize content like emails. Cohesity has also continued its relationships with Cisco and Hewlett Packard Enterprise, both investors in the company.

Regarding financial growth, Cohesity experienced a 29% annual revenue increase in 2022. 

The company has raised $660.55 million over five rounds, with its most recent round being a $250 million Series E round, which valued the company at $1.94 billion at $13.86 per preferred share. Investors include Sequoia, Wing Venture, Google Ventures, Accel Partners, Battery Ventures, Qualcomm Ventures, Cisco Investments, Hewlett Packard, SoftBank, Morgan Stanley Expansion Capital, DFJ Growth, and others. While Poonen did not specify a target market capitalization, he emphasized the importance of achieving the best possible valuation alongside strong products and market growth.

To prepare for the public offering, Cohesity is focusing on achieving profitability through positive free cash flow. This approach includes cost-cutting measures, such as recent layoffs. Poonen, drawing from his extensive experience in the tech sector, believes that solid financial foundations are crucial for sustainable growth, a perspective that may resonate with investors in the current market climate.