MongoDB Looks to Future Following IPO
MongoDB CEO and President Dev Ittycheria rang the opening bell at the NASDAQ MarketSite this morning as shares in the local New York City company started trading under the ticker symbol MDB. With about $200 million in proceeds from the initial public offering (IPO), the company says it’s well-positioned for the future.
The company announced last week that it aimed to sell a block of 8 million shares at $24 apiece, which was above the expected range of $20 to $22 per share. Nevertheless, the shares quickly gained about 30 percent in value and were trading near $30 per share with less than hour left in the trading day.
“The investor enthusiasm was very strong and we’re obviously very pleased about how investors reacted to the story,” Ittycheria told the hosts of CNBC’s “Squawk Box.” But it’s not even about today. It’s about the future. We’re literally going after one of the largest markets in enterprise software.”
While it sports a market capitalization of around $1.5 billion now, MongoDB owns a small slice of that overall database market, which is worth between $30 billion and $60 billion, depending on who you ask. The database market today is dominated by vendors like Oracle, IBM, Microsoft, and SAP, which generate billions in revenue by building and selling relational databases that power the bulk of the world’s complex computer applications.
But MongoDB, which has 4,300 customers and recorded $101 million in revenues last year, sees itself in the driver’s seat for the next wave of innovation and growth in databases. That’s because it’s actively upsetting the database apple cart by doing things in a decidedly different way.
Instead of storing data in rows and columns that’s accessed by writing stringent SQL queries, as relational databases do, MongoDB stores data in a series of documents that can be accessed using a relatively simple API call. The types of data stored in the documents can be changed and added to without requiring all the other data to be reordered, which is a positive trait that MongoDB shares with other NoSQL databases.
This approach, it turns out, is much more friendly to Web and mobile application developers who are constantly updating and tweaking their apps to suit the changing needs of their users. It’s no surprise that MongoDB counts developer support as the number one reason for its success.
“We’re a company founded by developers, for developers,” MongoDB’s Vice President of Cloud Products & GTM, Sahir Azam, tells Datanami. “We’re focused on building a modern flexible database platform that meets the need of new modern applications, whether that be mobile apps, IoT apps, or cloud-based business critical apps.”
The database part of the platform stack could use some sprucing up, MongoDB executives say. “Most applications today are running on a database technology introduced in the 1970s,” says Ittycheria. “I was using a rotary phone to make phone calls.”
MongoDB is the first database company to go public in 20 years, according to Azam. “It’s not easy to put forth the investment needed and capital and engineering horsepower needed to build an operational database to the level of maturity that I think MongoDB has achieved,” he says. “That in many ways is no small feat and testament and execution of the team over the last 10 years.”
Web development tooling progressed considerably by 2007, when Eliot Horowitz, Dwight Merriman, and Kevin P. Ryan founded MongoDB after building a database to power a new application. “We needed a database for it, and we realized that the database was much more fun than the application we were going to build, so we set off to build the database that we wanted,” Horowitz told Datanami earlier this year at the company’s user conference in Chicago.
MongoDB was the first mover in what quickly became a crowded market of NoSQL databases, including its top competitors like Datastax, Couchbase, and MarkLogic, among many others. “In many ways we are a trailblazer in the sub-segment of database software,” Azam says. “We’re part of a much larger trend: Developers becoming ever more influential and important, software becoming more critical to more of the world’s business, and frankly the adoption of cloud as well…These are all big trends that certainly MongoDB is proud to be at the center of.”
The cloud looms largely in MongoDB’s future. In fact, the bulk of MongoDB usage today is already in the cloud, according to Ittycheria, who counted partnership with Amazon, Google, and Microsoft Azure among the company’s most important. The company’s managed database-in-the-cloud offering, called MongoDB Atlas, is the fastest growing part of the business, he says. “We feel like we’re well positioned and this is a massive opportunity,” Ittycheria says.
There was excitement at MongoDB headquarters today, especially after the morning ceremonies at the NASDAQ site near Times Square. But then it was back to work.
“We’re excited. It’s a proud moment for the company,” Azam says. “But at the same time, we realize this isn’t the end for us. This is really just one important milestone for us in a long important journey. Given the size of the market that we’re tackling is massive and the opportunity is largely in front of us.
“We’re excited. We’re celebrating. We’re proud. But we’re very much focused on the future.”