Okta competitor SailPoint races toward $11.5B IPO

Cybersecurity company SailPoint is hoping to go public — again. This time, the company plans to sell $1 billion worth of stock and hit an $11.5 billion valuation in its planned IPO.

That’s how the math works out for a proposed offering it announced Tuesday of 47.5 million shares, at between $19 and $21. SailPoint’s owner, Thoma Bravo, plans to also sell 2.5 million shares.

SailPoint offers identity management wares to enterprises and is a competitor to $16 billion market-cap Okta.

This isn’t SailPoint’s first time as a public company. It was publicly traded until Thoma Bravo took SailPoint private in 2022, valuing it at $6.9 billion at the time. The private equity giant will still own over 87% of the company after the IPO.

The company said in its S-1 filing that it’s on track for $813 annual recurring revenue, as of October. SailPoint reported annual net losses of just over $395 million on about $700 million in revenues as of January 2024; the company said it has more than $1 billion in debt, with its balance sheet showing debt of $1.5 billion. SailPoint said it will use the proceeds to address its debt, as well as fund operations.

Given the financial sophistication of SailPoint’s owners, the stock may very well price above that range and easily bypass that hoped-for cash haul and valuation.

Founder Mark McClain, who stayed on as CEO after Thoma Bravo acquired the company, still has a relatively tiny stake of just over 3.6 million shares.

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“Not many founding CEOs find themselves in a position to introduce their company to the public market for a second time, but I am grateful to be able to do precisely that,” he remarked in his prospectus letter.

Because SailPoint isn’t a startup, this IPO, which could happen next week, won’t be a boon for any venture capitalists. But the success of the offering will be closely watched by them. VCs and startups are still reading the tea leaves on the timing to bring their many IPO-ready tech startups public. Should retail investors gobble the stock, this will be another signal that 2025 could be a good year to open not just a window, but also a door.

Then again, even if investors are hungry for this IPO, other factors could slow other offerings.

Wall Street grew plenty nervous over the Trump administration’s plans to start a North America tariff trade war, although those plans have now been postponed for at least a month. Should policy events keep rattling the markets, tech startups may just continue to stay under cover.