New IPO Filing Confluent, valued at over $4B previously

Confluent, which makes cloud software (open source) Apache Kafka for enterprises filed confidentially for an IPO on April 20th.

Confluent Files to Go Public. Who Could Be Next?
Confluent makes Apache Kafka

Confluent CEO Jay Kreps, co-created Kafka with fellow LinkedIn engineers Neha Narkhede and Jun Rao founded it in 2014, in the Bay area (Silicon Valley).

Confluent raised $250M in a Series E round in April 2020, bringing the company’s total funding to $456M. At that time, it was valued at $4.5B.

The company has positioned its Confluent Cloud as a enterprise offering for organizations that want to get value out of a Kafka-based real-time streaming data system, while at the same time continuing to make big engineering investments in the core Kafka software. 

What is Confluent?

The Confluent Platform is a stream data platform that enables you to organize and manage the massive amounts of data that arrive every second at the doorstep of a wide array of modern organizations in various industries, from retail, logistics, manufacturing, and financial services, to online social networking. 

The video below gives you a good overview.

What is Confluent Platform? | Confluent Documentation
Confluent Platform for real time data

The Confluent Platform is a collection of infrastructure services, tools, and guidelines for making all of your company’s data readily available as Realtime streams.

What is the Confluent Platform? | Confluent Platform 3.1.0
Confluent takes all real time data and brings it together for analysis

Apache Kafka is a real time, fault tolerant, highly scalable messaging system. It is widely adopted for many use cases ranging from collecting user activity data, logs, application metrics, stock ticker data, and device instrumentation.

Comparing Confluent Kafka and Apache Kafka - Dattell
Confluence leverages Apache Kafka (open source)

At its core, the Confluent Platform leverages Apache Kafka, a proven open source technology created by the founders of Confluent while at LinkedIn.

Kafka acts as a real time, fault tolerant, highly scalable messaging system and is already widely deployed for use cases ranging from collecting user activity data, system logs, application metrics, stock ticker data, and device instrumentation signals.

Its key strength is its ability to make high volume data available as a real time stream for consumption in systems with very different requirements – from batch systems like Hadoop, to real time systems that require low-latency access, to stream processing engines that transform data streams immediately, as they arrive.

What is the Confluent Platform? | Confluent Platform 3.1.0

Kafka is deployed at more than 80% of the Fortune 100. Information technology teams use it to stream diagnostics information from data center infrastructure to their monitoring applications.

Marketing departments can harness Kafka to transport website activity metrics to their analytics systems. 

Kafka, however is difficult to manage. Confluent’s commercial versions of the platform simplify the task. LinkedIn open-sourced Kafka in 2011, and it quickly gained a foothold in companies like Netflix, Uber and others.

Confluent employs more than 1,400 people at its Mountain View headquarters as well as at offices in San Francisco and India.

Confluent hit $127M in revenue in 2020

Confluent has raised over $456M in funding from venture capital. It reported a run-rate of $207M in 2020 ($17.6M MRR – Monthly Recurring Revenue).

Confluent grew revenues 100%+ in 2019 and over 80% in 2020. While still unprofitable, the company will be looking to raise about $500M by selling shares at $6B – $8B in the public markets, (depending on the market, it might get a lower valuation as well).

For 2021, the estimated revenue is between $310M – $350M, giving it approximately 16X – 23X Enterprise Value to Next Twelve Months Revenue multiple.

$CFLT Updated revenues

$CFLT Confluent had $208M in 2020 revenues, growing at 51% YoY. Gross Margins were 77% and net losses were $229M.