Happy pre-IPO day. Both Cloudera and Carvana are set to go public tomorrow—a rare double-header for late-stage startups.
We’ve discussed Cloudera quite a few times on these pages. The company is an intriguing example of a startup’s valuation getting ahead of its worth while still private. Cloudera expects to go public at a fraction of its prior valuation. It will still tip the scales near $2 billion at the upper-end of its range, but that’s a tough result for its final investors who valued the firm at the $4 billion mark several years ago.
Today, we’ll focus on Cloudera, a firm that is more interesting to this little publication because, and this may come as a shock, we know very little about the market for cars. So we’ll stick with more traditional tech companies.
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For this morning, I’ve pulled the most interesting Cloudera slides out from the presentation to save you time. When asked, Cloudera declined to provide Crunchbase News with higher-resolution images.
Let’s dive in.
Cloudera, In Slides
First, here’s how Cloudera gives investors a quick overview of its business, discussing its market and its own performance results derived from that same market. Note the high recurring revenue percentage and strong net expansion:
Next, here’s how the company describes expanding cohort performance over time. This is the above net expansion percentage, multiplied by time:
Scooting along, how do you spin an investment that saw your largest corporate investor overvalue you by about 100 percent? It looks like this:
The following charts show off the company’s subscription model. The first shows that the company managed 57 percent year-over-year growth over its last two fiscal years. This, you will recall, is a repeat from our first highlighted slide. But it’s connected to the below, right graphic, which touts a higher percentage growth rate. Why? The latter deals only with subscription income, which is expanding at a much faster rate than its services top line (good sign):
There is more on the company and its “land & expand” model, and how it helps Cloudera grow over time. The left chart is a single customer’s growth in usage of Cloudera’s products, and the left shows yearly expansion for the Fiscal 2014 customer cohort. So, the left is a single customer example, while the 2014 group is a collection of companies bucketed by fiscal year:
This fun chart, painfully, lacks a Y axis. As such, I presume it is largely a cosmetic experiment. But note how this narrative is important to Cloudera selling a future of improved margins:
And what happens to all of that revenue over time in terms of its profitability? Well, Cloudera has notes on that for the investing masses. (Spoiler: it improves over time as CAC is repaid and gross margins do their work). The Y axis is, again, missing:
Next up, Cloudera’s margin improvement goals for the current fiscal year and ongoing. Some of these numbers seem very doable, such as the “long-term model” margin points. Less instantly-believable, perhaps, is the move from a 74 percent “S&M / Revenue” spend to a 30 to 34 percent result, especially when the firm expects a modest 1 percent improvement on that metric in its fiscal 2018:
And, finally, more on Cloudera’s improving market performance (non-GAAP basis):
Now you know how one modern unicorn is selling itself to the investing masses. We’ll update this post when Cloudera prices.
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