Software Maker Samsara Rises in Trading Debut
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Technology developer Samsara launched an initial public offering on Dec. 15, a move that a top executive said positions the company for continued growth by bringing in key investors to help fund future initiatives.
“In terms of the IPO itself, we are extremely happy with the results,” said Kiren Sekar, Samsara’s chief product officer, during a Dec. 17 interview with Transport Topics. The San Francisco-based company offers a cloud-based platform that businesses with physical operations can use to gather and analyze Internet of Things data. Its customers include logistics and transportation companies as well as food and beverage, construction, energy utilities and local governments.
Samsara debuted under the ticker IOT on the New York Stock Exchange at a price of $23 per share. The company sold 35 million shares and raised $805 million on its first day of trading.
Sekar
Sekar said the company from its early days was thinking long-term about its future. “We knew from the beginning that an IPO was a natural part of that process,” he said. “It allows our company to raise capital from new types of investors who can partner with us over the long term.” Sekar said going public also offers customers some assurance that the business meets standards of governance and visibility.
Samsara grew 68% over the past year and achieved nearly $493 million in annual recurring revenue, Sekar said.
“We saw that our business had achieved a tremendous scale in a short amount of time,” Sekar said. “We got incredible interest from public market investors — high-quality investors — that we’re excited to partner with during our next stage of growth. So, we felt that we had all of the conditions that we needed to have a successful IPO.”
Samsara estimates the total available market for its services is $55 billion, and forecasts that could grow to nearly $100 billion in three years.
“That breadth of the solution, and the size and scope of the opportunity that we’re tackling, is really what I think led to the successful IPO,” he said. Samsara, he noted, has grown from a GPS-tracking provider to a firm that now offers drivers’ safety, equipment management and digital documentation services.
Sekar said the company’s two goals for the IPO were to raise capital to continue investing in new products and grow existing business, and also to partner with long-term-oriented investors who can help Samsara through its next phase of growth.
Samsara is officially listed on the @NYSE under the ticker $IOT
Thank you to everyone who helped us reach this exciting milestone, from employees and alumni, to customers, partners, investors, and more! #SamsaraIPO pic.twitter.com/N5E7JLSMxD — Samsara (@Samsara) December 15, 2021
“We achieved both of those goals,” he said.
Andreessen Horowitz, General Catalyst, Dragoneer, Tiger Global, AllianceBernstein, Franklin Templeton, General Atlantic, Sands Capital and Warburg Pincus are among Samsara’s institutional investors. They helped it raise $400 million in equity financing during a funding round in May 2020.
“In addition to our initial investment in Samsara in May 2020, we increased our investment in the company, reflecting our confidence in Samsara’s strong management team and vast opportunity, despite current market conditions,” a Warburg Pincus spokesperson told TT. “We look forward to Samsara’s next chapter of growth.”
Morgan Stanley, Goldman Sachs & Co., J.P. Morgan and Allen & Co. acted as lead book-running managers for the offering. RBC Capital Markets, Wells Fargo Securities, Evercore ISI and William Blair also acted as book-running managers.
“We’ve been operating Samsara in the way that a public company operates for quite some time now from the financial control to working with institutional investors,” Sekar said, “so we don’t expect any change in how we’re operating, how we’re making decisions.”
With the new funding, the company plans to add new products and features to its platform, and further develop its artificial intelligence and machine-learning capabilities to make data more actionable and help customers gain insights into operations to help, improve safety, efficiency, sustainability and sales, Sekar added.
“We are very excited about the [IPO] results, and all the opportunities that lay ahead,” he said.
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