April 3, 2017

Cloudera IPO Reflects Hadoop Shifts

George Leopold

(Ash Design/Shutterstock)

Cloudera Inc. joins a growing list of data analytics and platform vendors going public with a highly anticipated initial stock offering expected to raise an estimated $200 million.

The big data analytics and Hadoop software specialist based in Palo Alto, Calif., filed regulatory paperwork on Friday (March 31) to list on the New York Stock Exchange under the symbol “CLDR.” The startup was recently valued at more than $4 billion.

Founded in 2008, Cloudera is the latest software company to launch an IPO in anticipation of stiff competition from established players such as IBM (NYSE: IBM) and Oracle (NYSE: ORCL) along with leading cloud vendors Amazon Web Services (NASDAQ: AMZN) and Micosoft Azure (NASDAQ: MSFT). In the works for several years, the Cloudera IPO follows stock offerings by data analytics software vendor Alteryx and API specialist MuleSoft (NYSE: MULE).

Those startups expect intense competition as enterprise vendors begin to roll out new data platforms based on deep learning and other emerging technologies. In its securities filing, Cloudera emphasized the importance of deploying a next-generation data management platform incorporating a mix of machine learning and predictive analytics. Enterprises also need to be able to deploy these data platforms on-premise, in the public cloud or both, it stressed.

The company also has touted an enterprise “data hub” platform as a way of adding a layer of “pervasive analytics” via a unified framework and data formats along with data security and management. The company announced a partnership with the CIA in 2015. The CIA’s investment arm, In-Q-Tel, has joined in Cloudera funding rounds.

According to the web site Crunchbase.com, Cloudera has raised more than $1 billion on equity markets. Among Cloudera’s investors is chipmaker Intel Corp., which reportedly holds about 22 percent of Cloudera’s shares.

Cloudera also reported earnings of $261 million during its latest fiscal year ending Jan. 31 compared to $166 million the previous year. The bulk of the company’s revenue comes from subscriptions.

It also narrowed its net loss from more than $203 million a year ago to just over $187 million as of the end of January. Those losses were attributed to heavy investments in R&D along with sales and marketing expenses.

The stock offering comes as Cloudera and other Hadoop software vendors are sensing a shift away from the analytics framework to AI-driven cloud platforms. “Firms want to use more public cloud for big data, and Hadoop seems like a natural fit,” Brian Hopkins, a Forrester analyst noted in a recent blog post. But “Hadoop wasn’t designed for the cloud, so vendors are scurrying to make it relevant.”

The complexity of on-premises Hadoop deployments is accelerating the shift to public clouds as cloud vendors begin replacing Hadoop. “We already see Hortonworks, Cloudera, MapR, and Pivotal divorcing themselves from the Hadoop vendor label because they see this trend,” Hopkins added.

Meanwhile, Cloudera unveiled a web-based data science “workbench” at the recent Strata + Hadoop World conference designed to address security and governance issues associated with Hadoop clusters.

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