App performance management software maker AppDynamics files for IPO, seeks to raise $100M; firm lost $95M on $158M revenue in nine months before Oct. 31
Jordan Novet / VentureBeat :
Context & Ripple Effects
AppDynamics is taking the step its 2015 financing set up: after raising $83.4M toward a $150M target and then closing a $158M round led by General Catalyst and Altimeter Capital at a $1.9B valuation, the company has filed to raise $100M in an IPO. The filing discloses the cost of that growth — a $95M loss on $158M revenue across the nine months before Oct. 31.
First-order effects
- AppDynamics' $1.9B private valuation now faces a public-market test, with investors able to weigh the disclosed $95M loss against $158M in revenue rather than take the round price on faith.
Second-order effects
- A successful listing would hand rivals Dynatrace and Datadog a public comparable for the application performance monitoring category — both subsequently filed their own IPOs, with Dynatrace posting $431M in fiscal-year revenue and Datadog reporting $198M for 2018, suggesting the filing opened a template the category followed.
Third-order effects
- If the pattern holds, application performance monitoring shifts from a late-stage venture race into a publicly benchmarked software category, where growth-at-a-loss economics get repriced quarterly instead of round by round.
The trend: Application performance monitoring vendors are moving from billion-dollar private rounds to public listings, turning a venture-funded niche into a benchmarked public software category.