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Redis Labs, the startup behind the popular Redis database software, has surpassed a $2 billion valuation — about double the over $1 billion it was last valued at in August — as it prepares for an IPO as soon as this year.
That new valuation comes after Redis Labs announced Wednesday that it has closed a $110 million Series G round led by Tiger Global. The round also included participation from Softbank Vision Fund and TCV. Those three firms also acquired additional ownership in the form of a $200 million secondary transaction, where they bought shares of Redis Labs from existing shareholders rather than the company itself.
Redis Labs is targeting an IPO that could come later this year or early next, depending on market conditions, and CEO Ofer Bengal says that the company has already started preparations — building on Bengal’s previous comments to Insider that it was targeting 2021 to go public. It has now raised a total of $356 million.
Looking ahead, Bengal now says that Redis Labs has crossed $100 million in annual recurring revenue, reflecting an growth of 54% each year. If a year from now, Redis Labs is at $155 million in annual recurring revenue, that would be a “good point to go public,” Bengal said, although it doesn’t see it as a strict prerequisite.
Bengal also said that Redis Labs was approached by several unnamed SPACs — special purpose acquisition companies, an increasingly popular financial vehicle that’s allowed companies like OpenDoor and SoFi to go public without going through the traditional IPO process — to accelerate the process of hitting the public markets.
He said the company declined all those offers because it’s not ready yet. The company needs to hire a general counsel, get its accounting department ready for the rigor required by regulators, hire a general counsel, and add more women and independent directors to its board, Bengal said.
“We were not tempted by, ‘hey, let’s do a quick SPAC,'” Bengal said. “We are making all the preparations to be ready for IPO by year end, but the decision whether to pursue it is to be taken at that time considering market conditions. No one knows what it will look like by that time. If not, we have the luxury to wait.”
Redis Labs says it’s in it for the long haul
Monday’s announcement comes less than a year after Redis Labs announced its previous $100 million round of funding in August, at a valuation of over $1 billion. Bengal said that the company sees raising another huge round so soon as an “opportunistic move” stemming from inbound investor interest, rather than financial need.
He said that ultimately, this new fundraising comes with minimal dilution to the company’s shares, with only a 5% difference in ownership. Bengal says that now investors hold 10-15% of the company.
In picking investors for its recent fundraising rounds, Bengal said that the startup went with the firms that could commit to sticking with Redis Labs even after an IPO, rather than dumping …read more
Source:: Business Insider – Tech
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