Rubrik shares were listed on the New York Stock Exchange on Thursday, debuting at $38 per share. The cybersecurity company priced its shares at $32 apiece on Wednesday evening, a hair above its initial goal range of $29 to $31 after raising $752 million. This share price gives Rubrik a fully diluted valuation of $6.6 billion, an increase of 88% from its last original valuation of $3.5 billion in 2019.
Rubrik sells cloud security software to enterprise customers and has 1,700 customers with contracts value greater than $100,000 and 100 customers who pay the company greater than $1 million a 12 months. According to Crunchbase, the Silicon Valley startup was founded in 2014 and raised over $550 million in enterprise capital.
The VCs most betting on Rubrik’s stock continuing to rise are Lightspeed and Greylock. Lightspeed has backed the company in five separate rounds, including leading the company in a Series A round in 2015. According to the company’s report, Lightspeed and its affiliates owned 23.9% of Rubrik shares prior to the IPO S-1 filing. Businesses’ buy-in to the company could also be as a result of the proven fact that Rubrik co-founder and CEO Bipul Sinha was previously a Lightspeed partner from 2010-2014. Sinha holds 7.6% of the shares.
Greylock owns 12.2% of Rubrik’s shares. The enterprise capital firm led the startup in a $41 million Series B round in 2016 and also participated in Series C and Series D rounds. Greylock partner Asheem Chandna has served on the company’s board since 2015.
In addition to Sinha, the other two co-founders of Rubrik have significant shares. Arvind Jain, co-founder and now CEO of artificial intelligence work assistant startup Glean, holds 7% of the shares. Arvind Nithrakashyap, co-founder and current CTO of Rubrik, holds 6.7%.
Other high-profile VC investors have also backed the company. Khosla Ventures led Rubrik’s round C in 2016; IVP led the company in a Series D round in 2017; and Bain Capital Ventures led the company’s Series E round in 2019. It’s unclear what percentage of the stock these corporations still own, but it is lower than 5% because none of those investors were listed in the company’s S-1. NBA star Kevin Durant, a member of Thirty Five Ventures, was also an investor.
Rubrik’s IPO performance is under more scrutiny than some other recent IPOs because Rubrik’s debut looks more like a 2021 IPO and less like the remainder of the 2024 IPOs. Ibotta debuted as a profitable company. Astera’s laboratory and Reddit recently achieved GAAP net income. However, Rubrik is an unprofitable company and its losses proceed to extend, not decrease.
The company said its revenue increased slightly below 5% from fiscal 2023 to fiscal 2024, from $599.8 million to $627.9 million. At the same time, the company’s losses continued to grow: net losses increased from 46% in fiscal 2023 to 56% in fiscal 2024.
However, the company’s metrics do have a shiny spot: subscription revenue. In the company’s most up-to-date fiscal quarter, subscriptions accounted for 91% of revenue, up from 73% a 12 months earlier. Subscription revenues are likely to be sticky, and their growth may explain why some investors are more confident about Rubrik’s future prospects despite its current losses and lack of profitability.
Rubrik is the fourth enterprise capital firm to go public in recent months as investors appear wanting to reopen the IPO market. All three corporations that existed before Rubrik – Ibotta, Reddit and Astera Labs – achieved success on their first day of trading and have all stabilized since then, some in higher positions than others. However, none of them were a disaster or a negative forecast for other potential IPOs this 12 months.
While 4 positive IPO debuts could push more corporations to the sidelines, current predictions that rate of interest cuts may not come as early in 2024 as many predicted could dampen the recent IPO market momentum.