Pure Storage, one of the true rising stars in solid-state NAND flash storage—and, in fact, all of IT—filed for an initial public stock offering August 12 with the Securities and Exchange Commission.
Not that this was a surprise to people in the business. The six-year-old company had been valuated by private investors at a reported $3 billion last year, and startups valued at levels like that don't stay startups for long. They either get bigger or they get acquired. Pure Storage has elected to get bigger with an IPO estimated to bring in $300 million from many new investors.
The company will be listed under the ticker symbol PSTG; Morgan Stanley will lead the IPO, the date of which has not yet been selected. Pure Storage did not reveal the exchange on which it plans to list its stock or how many shares the company planned to sell.
Pioneer in Built-from-Scratch Flash Storage
Pure Storage was one of the first companies to purpose-build its storage on NAND flash media. Solid-state storage requires very different software and connectors than does spinning-disk, hard drive-based media, and cofounders and co-CTOs John Colgrove and Michael Cornwell knew that from Day 1.
Pure Storage is all about speedy data movement. Speedy storage processing not only reduces complexity and accelerates IT infrastructure, but it also improves business continuity and productivity. In a data-driven, mobile-first world, fast storage often can be the difference between higher yield and lower margins, customer engagement and abandonment, productivity and downtime.
During its short time in business, Pure Storage has banked $530.9 million in eight rounds of funding from a total of 13 investors, according to CrunchBase. Its most recent round—exactly a year and a day ago—resulted in $60 million.
The company, in fact, has burned through a lot of cash—mostly due to sales and marketing investments. Despite its high valuation, Pure Storage's S-1 affidavit showed that the Mountain View, Calif.-based company is losing money at a rather alarming rate. In 2014, it reported a net loss of $183.2 million, while it banked $174.5 million in revenue.
Nonetheless, it retains its high regard in the industry.
On a Growth Upswing
Investors in Pure Storage undoubtedly will consider the upside of Pure's growth. Its sales in 2014 were up by a multiple of four from 2013. In Q1 2015, it had sales totaling $64 million, which translates to more than $250 million in sales this calendar/fiscal year.
Pure Storage makes FlashStack CI, an all-flash storage system composed of hardware, reference architectures, deployment and sizing guidelines, and single-call support. The reference architectures, which can mix and match other brands of storage componentry, are strictly for virtual server and virtual desktop deployments.