Software Tools Platform GitLab Jumps 35% in Trading Debut
Gitlab Jumps 22% in U.S. Initial Public Offering
(Bloomberg) -- Software development platform GitLab Inc. climbed 35% in its trading debut, giving the company a market value of almost $15 billion.
The shares closed Thursday at $103.89, after the company, along with co-founder Sytse “Sid” Sijbrandij, sold 10.4 million shares for $77 in the IPO to raise $801 million. The shares had been marketed for $66 to $69, a price target that had been elevated from an earlier range of $55 to $60.
Accounting for employee stock options and restricted stock units, the company has a fully diluted value of more than $17 billion.
GitLab provides collaboration tools used by software developers and competes with Microsoft Corp.’s GitHub. Goldman Sachs Group Inc., UBS Group AG, Siemens AG and ZipRecruiter Inc. are among its customers.
Investors in the remote-only company include funds and affiliates of August Capital, Alphabet Inc.’s GV, Iconiq Capital and Khosla Ventures, according to filings. Sijbrandij, the company’s chief executive officer, had planned to sell 1.98 million shares, which were worth $152 million at the IPO price.
Pandemic Effect
The coronavirus pandemic increased software developers’ reliance on GitLab, said GV General Partner Dave Munichiello.
“It’s no longer that they can get together in a small room and talk through the software that they’re building,” he said.
Though incorporated in Delaware in 2014, GitLab operates as a remote-only company and doesn’t have a corporate office, according to its filings. Its 1,350 team members are located in more than 65 countries.
Revenue Gain
The company had a net loss of $69 million on revenue of $108 million for the six months ending July 31, according to its filings. That compared with a $44 million loss on $64 million in revenue during the same period the previous year.
Proceeds of the offering will be used for general corporate purposes and working capital, according to its filings. The main purpose of the listing is to provide a public market for its shares and to increase the visibility of the company, the company said in the prospectus.
The offering was led by Goldman Sachs, JPMorgan Chase & Co. and Bank of America Corp. The shares are trading on the Nasdaq Global Market under the symbol GTLB.
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