GitLab CEO sees $ 6 billion public market secondary to $ 6 billion

GitLab CEO Sid Sijbrandij said a share sale of employees, which valued its software launch at $ 6 billion, said he still wanted to announce the company, although he was watching many more options than were available in the past.

Sijbrandij on Thursday confirmed CNBC’s end-of-November coverage of the company’s valuation in its secondary offering, which allowed employees to sell up to 20% of their established equity. He provided additional details about the size of the deal and the investors, as well as revenue growth and new customers.

GitLab’s cloud-based software is used by developers to share code and collaborate on projects. The company, which competes with Microsoft’s GitHub and Atlassian, has seen a surge in demand as more industries rely on software and digital tools to run their operations. GitLab specializes in helping coders speed up product updates, reduce operating costs, and accelerate development.

GitLab generated $ 150 million in recurring revenue annually, Sijbrandij said after experiencing 74% growth in the most recent quarter. During 2020, the company signed three major airlines and a travel manager, although the travel industry was forced to cut back drastically due to the pandemic.

“It was the industry that was hit the hardest last year and even they still bought,” Sibrandij said. “It has been a difficult year for many of our customers.”

In its ‘team handbook’ on its website, GitLab has openly stated its plan to make public by November 2020. After the pandemic took place early last year by wooing the broader economy, the company scrapped the timing for its debut, while indicating that a listing was still on the roadmap.

Sijbrandij said he did the secondary work to “give our team members the opportunity to benefit from the value we have created together.” The valuation of $ 6 billion is higher than $ 2.7 billion in a late 2019 financing round.

GitLab has allowed current and former fixed capital employees to jointly sell 4.9 million shares, bringing the total offer to $ 195 million. Investors who bought the stock included Alta Park, HMI Capital, OMERS Growth Equity, TCV and Verition. For the transaction, GitLab uses the Nasdaq Private Market, which specializes in assisting private companies to provide secondary liquidity.

Sijbrandij said there is no timetable for a public market debut, although people familiar with the matter told CNBC in November that it would probably come in 2021. The company has a number of ways to consider going public that either do not exist or relatively exist. untested for last year.

One option is a direct listing, the way followed by Spotify, Slack, Palantir and Asana and followed by Roblox, which allows employees to sell shares to new investors immediately. Other companies such as Unity, Airbnb and DoorDash have chosen a hybrid auction that allows management to choose a price based on bid. And there is the opportunity to become known through a special acquisition company (SPAC), or a reverse merger by a so-called blank-check entity.

“There are many more options and we are following the market,” said Sijbrandij. SPACs offer an ‘interesting alternative that is also on our radar’, he said.

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