Cloudera, the enterprise big data company, closed the day up over 20% at $18.09, after pricing its IPO at $15 per share. This is also above the range of $12 to $14 that enterprise big data company was preparing for.
While the surging stock price is great for new investors, the outcome is still a significant disappointment for some employees of the company because their equity compensation has gone down in value if they joined the team after the last private round. Cloudera’s market cap is now about $2.3 billion, significantly less than the $4.1 billion valuation Intel gave in 2014. This increasingly common phenomenon is now nicknamed a “down round IPO.”
In an interview with TechCrunch, CEO Tom Riley insisted that this was not a problem for the company because of the “growth prospects ahead of us.” If it performs well in the stock market, it could ultimately achieve the $4 billion-plus value. Square, which went public in 2015 at half its private market valuation, has since seen its share prices more than double.
The company has raised over $1 billion since 2008….