It provides these cloud services through a purpose-built, web-scale software infrastructure built on commodity hardware. The company has attracted over 480,000 customers, who use its Backblaze Storage Cloud platform across more than 175 countries on its approximately 2 exabytes, or 2 trillion megabytes, of data storage under management.īackblaze was founded in 2007 and booked $60 million in revenue for the 12 months ended June 30, 2021. It plans to list on the Nasdaq under the symbol BLZE. Oppenheimer & Co., William Blair, Raymond James, JMP Securities, and B. Riley Securities are the joint bookrunners on the deal. It is expected to price during the week of November 8, 2021.Of course, such attractive markets also involve a strong competitive environment that includes the larger cloud storage players such as Amazon Web Services (AWS) and Microsoft's Azure, among others. Its self-service products also better suit individual users, as well as small- and medium-sized enterprises.īut Backblaze developed differentiated offerings thanks to its simplified structure and lower prices relative to competitors. As a result, the company managed to accumulate approximately 500,000 paying customers at the end of the last quarter.īecause of its low prices, Backblaze generated modest revenue of $31.5 million during the first half of 2021, up 24.7% year over year, boosted by the strong 60.3% growth of its IaaS offering to $10.1 million. Its larger DPaaS business grew only 12.2% year over year to $21.1 million. ![]() Third Quarter 2021 Financial Highlights: Revenue was 17.3 million, an increase of 25 year-over-year (YoY). ![]() Backblaze raised just 100 million in its offering, less than one-twentieth the amount raised this year by companies including GlobalFoundries, Robinhood and Bumble. The company has been investing in its infrastructure and offerings to support its growth and gain scale. ![]() B2 Cloud Storage revenue was 6.0 million, an increase of 59 YoY. As a result, operating leverage hasn't materialized yet. Net losses increased to $6.1 million during the first half of this year, compared to a $1.3 million loss in the prior-year period. With the surge in the stock price over the last several days, the company's market cap sits at roughly $912 million, which corresponds to 16.7 times trailing-12-month sales.Īt such a rich valuation, the market is already anticipating Backblaze will provide flawless execution over the next several years to match or exceed the growth of its markets while improving profitability. However, investors should realize the company remains exposed to intensifying competition, given the low barrier to entry simplified cloud storage capabilities represent. Here's an illustration: In addition to the existing competition, the high-growth cloud delivery network specialist Cloudflare recently announced it has been developing a new cloud storage offering that should compete with Backblaze's. Indeed, Cloudflare's new cloud storage solution will most likely address the company's vast customer base of individuals and small businesses, which corresponds to Backblaze's core customers. More importantly, Cloudflare will be competing on price. For instance, Backblaze prices egress traffic (the network traffic you generate when you download a file) from its platform at an attractive 80% discount to AWS. It is expected to price during the week of November 8, 2021.But Cloudflare plans to offer egress traffic for free as it can leverage cross-selling opportunities between its cloud storage solution and its various other products. At the midpoint of the proposed range, Backblaze would command a fully diluted market value of $644 million.īackblaze states that it is a leading storage cloud platform, providing businesses and consumers cloud services to store, use, and protect their data. The San Mateo, CA-based company plans to raise $100 million by offering 6.3 million shares at a price range of $15 to $17. ![]() Backblaze, which provides cloud storage for consumers and SMBs, announced terms for its IPO on Tuesday.
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