In GitLab’s IPO file – TechCrunch


Rapid growth, persistent losses

While technology and the business community worked around the weekend, DevOps company GitLab filed a release request. Before we start our free time, we need to take a break, digest the company’s S-1 file and draw some initial conclusions.

GitLab competes with GitHub, which Microsoft bought for $ 7.5 billion in 2018.

The company stands out for its long-standing, remote-first stance, and for being more public with its metrics than most unicorns – for a while, GitLab had an IPO target on November 18, 2020 in its public plans, to take an example. We also knew when it crossed the $ 100 million recurring revenue threshold.

Considering GitLab’s more recent results, a declining operating loss over the past two quarters is good news for the company.

The company’s IPO was therefore long overdue. In its last main transaction, GitLab raised $ 286 million for a post-currency valuation of $ 2.75 billion, per Pitchbook data. The same news source also notes that GitLab executed a secondary trade earlier this year worth $ 195 million, which earned the company a valuation of $ 6 billion.

Let’s analyze GitLab’s growth rate, its final pre-IPO scale, its SaaS metrics, and then ask if we think it can exceed its most recent price in the private market. It sounds good ? Let’s dance.

The GitLab S-1

GitLab intends to appear on Nasdaq under the symbol “GTLB”. Its IPO filing lists an estimated increase of $ 100 million, although that figure will change when the company sets an initial price range for its shares. Its fiscal year ends on January 31, which means its quarters are one month behind traditional calendar periods.

Let’s start with the big numbers.

In its fiscal year ended January 2020, GitLab recorded revenue of $ 81.2 million, gross profit of $ 71.9 million, operating loss of $ 128.4 million and net loss slightly higher of $ 130.7 million.

And in the year ended Jan.31, 2021, GitLab’s revenue grew by around 87% to $ 152.2 million from the previous year. The company’s gross profit increased about 86% to $ 133.7 million, and operating loss widened nearly 67% to $ 213.9 million. His net loss totaled $ 192.2 million.

This paints the picture of a rapidly growing, large-scale SaaS business, with gross margins essentially flat (88%). Growth hasn’t been cheap either – GitLab has spent more on sales and marketing than it generated gross margin in the past two years.


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