Inside GitLab’s IPO filing

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while technology And the business world worked over the weekend, according to developer operations (DevOps) firm GitLab. filed to go public. Before we get into our time, we’ll need to pause, digest the company’s S-1 filing, and come to some preliminary conclusions.

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GitLab competes with GitHub, which Microsoft bought back in 2018 for $7.5 billion.

The company is notable for its long-held, remote-first stance, and for being more public with its metrics than most unicorns — for the time being, GitLab has announced November 18, to take an example, in its public plans. , 2020 IPO was targeted. We also knew when it crossed the $100 million recurring revenue threshold.

Given GitLab’s recent results, the low operating loss over the past two quarters is good news for the company.

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Therefore, the company’s IPO was expected for a long time. In its last primary transaction, GitLab raised $286 million at a post-money valuation of $2.75 billion, per pitchbook data. The same information source also notes that GitLab executed a secondary transaction worth $195 million earlier this year, giving the company a valuation of $6 billion.

Let’s analyze GitLab’s growth rate, its eventual pre-IPO scale, its SaaS metrics, and then ask if we think it can surpass its most recent private-market value. sound good? let’s Rock.

GitLab S-1

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GitLab is intended to be listed on the Nasdaq under the symbol “GTLB”. Its IPO filing pegs the placeholder at $100 million, although that figure will change when the company sets an initial price range for its shares. Its fiscal year ends on January 31, meaning that its quarters are offset by one month from traditional calendar periods.

Let’s start with big numbers.

In its fiscal year ended January 2020, GitLab posted revenue of $81.2 million, gross profit of $71.9 million, an operating loss of $128.4 million, and a marginally higher net loss of $130.7 million.

And in the year ended January 31, 2021, GitLab’s revenue grew nearly 87% from a year earlier to $152.2 million. The company’s gross profit increased approximately 86% to $133.7 million, and operating loss increased approximately 67% to $213.9 million. Its net loss totaled $192.2 million.

It paints the picture of a SaaS company growing rapidly at scale, with essentially flat gross margins (88%). Growth hasn’t been cheap either – GitLab has spent more on sales and marketing than it earned in gross profit over the past two fiscal years.

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