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Atlassian files for IPO
- jamesfzhang 11y agoRevenue: $148.5m (FY2013) $215.1m (FY2014) $319.5m (FY2015) Net income: $10.8m (FY2013) $19.0m (FY2014) $6.8m (FY2015)
- deleted 11y ago[deleted]
- guiomie 11y agowhy is it down for FY2015 net income? And Aren't those margins kinda thin?
- nemo44x 11y agoNot at all. They are investing their profits into scaling and growing the business.
- mbesto 11y agoThis. And no, software margins are not categorically thin (see SAP, Oracle, Microsoft, etc).
- colinbartlett 11y agoI don't believe those margins are thin by public company standards. Perhaps we are spoiled by Apple who operates at insane margins?
- Nicholas_C 11y agoHuge increases in R&D and marketing expenses, mostly.
- andrewcamel 11y agoDoesn't the R&D ramp look a bit unusual? 57 -> 79 -> 141? Totally destroys their margins, right in the year when they must know they're going public?
- Nicholas_C 11y agoAs a percent of revenue the R&D increase doesn't look as crazy. R&D as % of Revenue by year: 2013 39% 2014 37% 2015 44% The marketing and sales expense goes from 13% to 21% of revenue in 2015 The growth in these line items really compress their margins in 2015.
- nkohari 11y agoThey've been reinvesting potential profit into the company in order to grow R&D. (Spend has increased from $57M in FY13 to $141M in FY15.) Their gross margins are probably what you want to look at instead, since their cost of revenue won't include R&D ($ in 1,000s): FY13 FY14 FY15 Gross revenue 148,512 215,109 319,521 Gross profit 115,481 117,123 266,589 Gross margin 77.7% 54.4% 83.4% These are very healthy for a software company. They nearly doubled their spend on sales and marketing between FY13 and FY14, which explains the temporary dip in gross margin in FY14.
- tkinom 11y agoA few year back, I read about their sells process are 100% user self direct into their websites. I wonder if they stay with that model or do more of the "enterprise sells" now.
- mikkelewis 11y agoWow, the founders still hold a combined 75% of equity.
- nostrademons 11y agoIt really helps to not need funding when you go to seek funding.
- deleted 11y ago[deleted]
- danieltillett 11y agoYes this is what happens if you grow slowly rather than at the usual VC recommended pace.
- caseysoftware 11y agoThat was my reaction too. Over 80% of the company is still in the hands of the executives, directors, etc. That is amazing and even a relatively modest (by current standards) IPO will mean a huge windfall for many of them.
- chollida1 11y agoInteresting Slack and Github investors will be watching this closely! Will be interesting to see what the market thinks about a profitable company going public. 13 years from starting to going public, so those of you who join a startup going on its 4th year, something to keep in mind. You could have joined in year 5 and had your shares vest by year 9 and then be waiting for an additional 4 years for your liquidity event! > https://www.sec.gov/Archives/edgar/data/1650372/000104746915008450/a2226437zf-1.htm#dy77101_principal_shareholders https://www.sec.gov/Archives/edgar/data/1650372/000104746915... Kindof weird that their CFO resigned in October, just before they went public. That's probably something I'd want to know about in more depth if I was going to invest. I wonder if they delayed the IPO so this could happen before they filled. Seeing as they brought him in to lead them through the IPO process, this seems a bit of a weird time to leave, this is probably the busiest time for a CFO. > http://www.bloomberg.com/news/articles/2015-02-11/atlassian-appoints-erik-bardman-cfo-ahead-of-planned-ipo http://www.bloomberg.com/news/articles/2015-02-11/atlassian-...
- whatok 11y agoFrom the S1: " In October 2015, our former Chief Financial Officer, Erik Bardman, resigned from the company to focus on matters related to a past employer, including an investigation of certain accounting practices entirely with respect to such past employment." https://management-change.com/atlassian-cfo-erik-bardman-ousted-matters-with-a-past-employer/ https://management-change.com/atlassian-cfo-erik-bardman-ous...
- jackgavigan 11y agoMight have something to do with Logitech: http://www.reuters.com/article/2014/09/04/logitech-investigation-idUSL5N0R51PZ20140904#2oB0AyBf1W5XsWF6.97 http://www.reuters.com/article/2014/09/04/logitech-investiga...
- walterbell 11y agoAtlassian had financing rounds which provided employees with liquidity, http://fortune.com/2014/04/10/atlassian-the-3-3-billion-software-company-youve-never-heard-of/ http://fortune.com/2014/04/10/atlassian-the-3-3-billion-soft... "The $150 million it recently raised isn’t going into its bank account — instead, its new investors are buying shares from past and present employees in an effort to offer workers some liquidity and retain talent ... 'the Accel Partners round was mostly about founders, and this [T. Rowe Price] one is about employees. Now neither of the founders are selling anything. So this is a little different. We’ve been profitable for 10 years, so we don’t need the cash, we have a lot of cash in the bank. It’s more a case of wanting to get a partner [that knows about public markets] on board..'"
- skhatri11 11y agoYou mean a S-1?
- danellis 11y agoNo, F-1, because they're a foreign company.
- _kyran 11y agoInteresting that this has happened so soon after relocating to the UK (2014) from Australia. I wonder if they plan to stay there or move the US as well?
- bsimpson 11y agoI didn't realize that they weren't based in SF, since they have a large presence here. In fact, the Chief Legal Officer cited in that filing is based in SF. According to statements made by the founder[1], the move to London was designed to make them more integrated into the global economy ahead of their IPO. That tells me that they aren't moving again any time soon. [1] http://www.afr.com/technology/atlassians-farquhar-justifies-london-switch-20140217-ixrqy http://www.afr.com/technology/atlassians-farquhar-justifies-...
- cam- 11y agoIt is no uncommon for Australians to start their world working tour in London/UK either.
- deleted 11y ago[deleted]
- tajen 11y agoAccording to the "foreign private issuer" paragraph, "more than 50% of our assets cannot be located in the United States", and ditto for the board members. They are primarily based in Sydney, they might be the biggest importers of developers in Australia actually ;) but the SF office is large too, they hold a few usergroups in it, as well as the Atlassian Summit which just ended (3-5 Nov). https://summit.atlassian.com https://summit.atlassian.com . No wonder you believed they were SF based.
- kaizendad 11y agoPresumably this is why they completely repackaged JIRA a few weeks ago. http://www.cio.com/article/2989783/atlassian-takes-jira-beyond-the-development-world.html http://www.cio.com/article/2989783/atlassian-takes-jira-beyo.... Now they have the broad corporate-focused packages that will play well on Wall Street. They also have upside growth from the repackaging that can drive speculative pricing beyond what their current financial statements would justify.
- bjacks 11y agoHow can I buy shares?
- castis 11y agoI am not well versed in the stock exchange but I believe your options are: A. Work for Atlassian. B. Wait until they go public.
- mediocrejoker 11y agoI believe the document these comments are linked to is a filing that states that Atlassian is, in fact, going public.
- stygiansonic 11y agoCheck if your brokerage is offering them. Usually there will be a way you can sign up for "new issues". In this arrangement, you would enter into an "expression of interest" to purchase shares at the IPO price, if your broker was allotted any shares by the underwriters. Once you have entered into this, you must be ready to buy the number of shares you indicated at the IPO price, but if there is a lot of interest, you may not get fully filled and may not even get filled at all.
- esaym 11y agoI hope it works well for them. I've seen many companies go down the tubes after deciding to go public. Which makes me wonder why one would even want to go public in the first place? The allure of perhaps making more money?
- Blackthorn 11y agoYou know all those employees that you gave equity to in order to lure them onboard? Well, you've got a few options at that point. You can go public so they can cash out. Or you can do some kind of revenue-sharing scheme so they can get cash. Or something. Point is, you have to make good on your promise to them (their equity) at some point or they're all going to quit.
- icedchai 11y agoYou don't think most employees are smart enough to realize options in most startups are like lottery tickets? Yeah, you might win, but the probable value is zero or close to it.
- progmal1 11y agoYes, but in this case, they have a winning lotto ticket that is hard to cash.
- esaym 11y agoThere is that issue, but surely not all startups offer that?
- theseatoms 11y agoEquity investors of all kinds will eventually want to liquidate.
- heywire 11y agoI wanted to ask this same question. I know the public market is very important to our economy, but I feel like for so many companies, going public optimizes them for the wrong things.
- unethical_ban 11y agoI'd short it technically because Confluence is Satan's wiki, but corps eat it up because WYSIWYG and because it costs money. (FOSS is bad, doncha know).
- deleted 11y ago[deleted]
- icedchai 11y agoWhat do you think about Jira?
- Laaw 11y agoNot a huge fan of Confluence (just give me Markup, dammit), but Jira is simply the best at what it does.
- icedchai 11y agoPretty much all developers I know can't stand Jira. Management loves it though.
- Dirlewanger 11y agoYup, JIRA is a power-manager's wet dream. Whatever way one can think of for adding "things" to a task (and how to classify them, and how to keep track of them...), Atlassian has probably thought of it. For a developer who just wants to keep the tool at a distance and only log into it to move their shit across the scrum board and promptly log back out, they better hope their scrum overlords have looked upon them kindly.
- cowmix 11y agoAlmost every time my company gets called in to do JIRA consulting the situation is this: Devs bring JIRA in.. JIRA gets popular.. things get out of control. It is almost NEVER brought in by management.
- s73v3r 11y agoThat's a shame. I liked their products.
- codezero 11y agoWhy is this a shame? Do you think IPOing will affect their products & direction?
- Karunamon 11y agoYes. Example: They recently did a massive reshuffle on their Jira product lines. Now instead of Jira + a set of software dev plugins, it's two separate products. Jira Core, and Jira Software, which bundles all the software dev stuff that you used to have to buy separately. If you were a Jira license holder before this change, you basically got bumped to Jira Software (i.e. you got access to the dev stuff) for the same price you were paying before. I would not see this happening with a public company. Going public exposes you to the toxic "growth at all costs" mindset of short-term, quarter to quarter thinking investors, which pressures the company to screw their customers to make the balance sheet look a bit better. This isn't going to happen immediately, but they're on a clock now. It will happen sooner or later, mark my words.
- s73v3r 11y agoYes. Going public has never done anything good for any company. Once going public, it's all about quarterly reports and pleasing a few hedge funds.
- nemo44x 11y agoThis will be a great litmus test for relatively new and growing technology companies to determine when it's right to IPO in this market. There have been a number of recent IPO's from companies with great growth but no profits to show for it. The market has mainly rejected these companies and the companies are trading near IPO levels or below. Some of them after taking a down round to go public even, such as HDP. Atlasssian is showing very good growth and profits, however modest (which they should be for them - reinvesting in the company is the best action right now), which I assume would end up with a pretty decent multiple. My midline would be a 4 billion market cap based on current growth trajectory, current and potential earnings (and their reinvestment in the business) and cash on hand which should limit and sort of second round any time in the foreseeable future. This isn't based on PE (it would be extremely high right now) but rather the revenue growth and cash stability to allow sustainable reinvestment in the companies marketing, R&D and sales departments. It's a bit over 10x forward revenue.
- tajen 11y agoThe most awesome of the awesomest companies: " An application has been made to list our Class A ordinary shares on the NASDAQ Global Market under the symbol "TEAM"." Only Atlassian could ask to be listen as "TEAM". Is there a "quiet period"? I can't find the date of IPO on the document either. Does an IPO introductory price usually match the last round of funding? It seems on page 10, they mention $2.23 for Class A shares and $0.51 for Class B shares, which makes a total valuation of $148m. Last round valuation was $3.15bn [1]. It means those shares have been bought 21 times higher at the last round than the price mentioned in this document. Did I read it correctly? Page 62, chart: For $1 initial purchase, customers end up spending $8 in additional users, renewals and other products. It's my first time reading an F-1/S-1, it's awesome, there's plenty of information! Sales per continent, page 71! Marketing expenses page 80! That's awesome! [1] https://www.crunchbase.com/organization/atlassian https://www.crunchbase.com/organization/atlassian
- donkeyd 11y agoCan you explain why you think it's such an awesome company?
- hobbyjogger 11y agoThe prices on Page 10 (I actually see similar but slightly different numbers, the document may have been updated) are weighted-average exercise prices for all outstanding options. Since many of those options would have been issued years ago (presumably with low strike prices) the average option price bears little relationship to the IPO price (which we won't know until the IPO is priced by the underwriters--note the blanks throughout).
- gtrubetskoy 11y agoTwo similar companies that I can think of that went public recently is Splunk (SPLK) and Hortonworks (HDP) - their stock is trading mostly sideways, nothing exciting. Not sure what to attribute this to - having reliable business clients pay for your software seems like very solid business to me, after all isn't that how IBM's and Oracle's of this world came about. I suspect it comes down to how competitive this space is. Campfire used to be the thing not long ago, and then everyone went to Slack - who's to say that another competitor will not emerge and everyone will ditch their Jira's for something better?
- volaski 11y ago"Reliable business" is a double edged sword in this case because reliable also means predictable. A lot of blue chip companies get their high valuation because the public can see the potential but not completely so. Whereas companies like Splunk or Hortonworks it's pretty much predictable how they will keep making money (at least for the next couple of years assuming that nothing surprising will happen)
- 7Figures2Commas 11y ago> Whereas companies like Splunk or Hortonworks it's pretty much predictable how they will keep making money... Huh? Neither Splunk nor Hortonworks are profitable.
- volaski 11y agoI guess i should have been clear. I meant "making money" as in having a business model. Being profitable and having a business model are two different things. We can ask Amazon
- adventured 11y agoOk, so let's ask Amazon: they are both profitable and have a business model (further, for years running now, they've been able to demonstrate profitability whenever they feel like it to satisfy Wall Street worries). Their retail business has always had low margins, no different than Walmart by comparison.
- KeepTalking 11y agoI think very highly of JIRA and would use it again, but at a previous workplace ( over 1000 users) we required to have a JIRA/confluence admin who was spending over 50% of his time either keeping it running, adding connectors, or making modifications to suite various interest groups.
- zajd 11y agoIs that a bad thing? Why the but?
- netheril96 11y agoPerhaps because he believes a good solution should take care of itself without human intervention most of the time?
- w8rbt 11y agoI hope bitbucket stays the same. Great service for private repos with git and mercurial support.
- tomschlick 11y agoExcept for the availability issues over the past few months that would happen almost every other day. Moved my team to Github and poof, issues gone.
- shabuta 11y agoCore values include "Don’t #@!% the Customer" and it ended up on their SEC statement. Their stock went up in my book.
- WWKong 11y agoNo one wanted to translate it to some mature phrase like, "do right by the customer"? Too much work?
- tonytamps 11y agohttp://media.tumblr.com/tumblr_m09a7gL67A1r79r7q.gif http://media.tumblr.com/tumblr_m09a7gL67A1r79r7q.gif I even love saying the word "TEAM".
- deleted 11y ago[deleted]
- deleted 11y ago[deleted]
- halayli 11y agoTheir products are well designed but often sluggish which ruins the experience. I stopped using them because of that, unfortunately. It created a barrier in my head and made me hesitant every time I wanted to interact with their software.
- chii 11y ago
- mcv 11y agoWith Goldman Sachs? That's disappointing. I don't trust anything they do anymore.