SentinelOne IPO Price, Filing, Valuation Details: 10 Things to Know
SentinelOne‘s stock ($S) rose roughly 21 percent during the security software company’s IPO (initial public offering) on June 29, 2021. SentinelOne’s market capitalization was more than $10 billion after the first day of trading on the New York Stock Exchange.
Multiple SEC filings ahead of the IPO revealed SentinelOne’s big bet on XDR (eXtended Detection and Response) cybersecurity services, and strong revenue generation through channel partners — including MSPs and MSSPs (managed security services providers).
Here are 10 things to know about the SentinelOne IPO.
1. SentinelOne’s Mission: The filings stated:
“The world is full of criminals, state actors, and other hostile agents who seek to exfiltrate and exploit data to disrupt our way of life. Our mission is to keep the world running by protecting and securing the core pillars of modern infrastructure: data and the systems that store, process, and share information. This is an endless mission as attackers evolve rapidly in their quest to disrupt operations, breach data, turn profit, and inflict damage.”
2. Customer Base: As of April 2021, SentinelOne had more than 4,700 customers — up from 2,700 in April 2020.
3. Annual Revenue: The cybersecurity company’s annual revenue was $93.1 million in fiscal 2021, up 100 percent from $46.5 million in fiscal 2020.
4. Quarterly Revenue: SentinelOne’s quarterly revenue was $37.4 million for the three months ended April 30, 2021, up 108 percent from $18.0 million in the corresponding quarter last year.
5. Annual Net Loss: $117.6 million in fiscal 2021, which was larger than a $76.6 million net loss in fiscal 2020.
6. Quarterly Net Loss: $62.6 million for the three months ended April 30, 2021 — which was larger than the $26.6 million net loss in April 2020.
7. Cybersecurity Platform: SentinelOne is positioning as an XDR (eXtended Detection and Response) platform, rather than just an endpoint protection software company. SentinelOne says the Singularity Platform performs the following actions:
“Our AI-powered Singularity Platform defines and delivers XDR. Our platform ingests, correlates, and queries petabytes of structured and unstructured data from a myriad of disparate external and internal sources in real-time. We build rich context by constructing a dynamic representation of data across an organization. As a result, our AI models are highly accurate, actionable, and autonomous. Our distributed AI models run both locally on every endpoint and every cloud workload, as well as on our cloud platform. Our Static and vector-agnostic Behavioral AI models, which run on the endpoints themselves, provide our customers with protection even when their devices are not connected to the cloud. In the cloud, our Streaming AI detects anomalies that surface when multiple data feeds are correlated. Furthermore, our platform provides visibility across an organization’s digital assets through one console, making it easy and very fast for analysts to search through petabytes of data to investigate incidents and hunt threats. Our Singularity Platform offers multi-tenancy and can be deployed on a diverse range of environments that our customers choose, including public, private, or hybrid clouds.”
8. Growth Strategy: The company’s growth strategy includes five core elements:
- Continue to innovate and enhance the cybersecurity and data platform.
- Drive new customer acquisition. As part of that effort, SentinelOne will “continue to build our relationships with our channel partners, including MSPs, MSSPs, MDRs, OEMs, and IR firms, as well as our alliance partners to expand our market reach.”
- Increase adoption within the existing customer base.
- Expand the company’s global footprint.
- Expand through acquisitions.
9. Partner Ecosystem: SentinelOne describes its partner strategy this way:
“We have deep partnerships with many of the leading independent software vendors, or ISVs, alliance partners whom we engage with on joint technology and go-to-market strategies; and channel partners, such as distributors, resellers, managed service providers, or MSPs, managed security service providers, or MSSPs, managed detection and response providers, or MDRs, original equipment manufacturers, or OEMs, and incident response firms, or IR firms. As we empower our partners through technology, many of our partners act as force multipliers and broaden our market reach.”
10. Leaning Heavily on Channel Partners, MSPs and MSSPs:
- Channel partners generated 92% and 96% of SentinelOne’s revenue for fiscal 2020 and fiscal 2021, respectively.
- Also, channel partners generated 95% and 91% of the company’s revenue for the three months ended April 30, 2020 and 2021, respectively.
- Exclusive Networks: SentinelOne generated 19% of its revenue from Exclusive Networks for both fiscal 2020 and fiscal 2021; and 19% and 17% for the three months ended April 30, 2020 and 2021, respectively.
- SHI International: SentinelOne generated 14% and 13% of revenue from SHI International for fiscal 2020 and fiscal 2021, respectively. Also, the company generated 14% and 10% of revenue from SHI International for the three months ended April 30, 2020 and 2021, respectively.
All of SentinelOne’s partner agreements are non-exclusive, the company noted in the filing.
12. Bonus – Key Rivals: In the SEC filing, SentinelOne says competitors and potential competitors include:
- endpoint security providers, such as CrowdStrike and VMware (which acquired Carbon Black);
- legacy anti-virus providers such as McAfee, Symantec (a subsidiary of Broadcom), and Microsoft; and
- providers of general network security products and services that offer a broad portfolio of solutions, such as Palo Alto Networks.
SentinelOne: Stock Ticker Symbol “S” and Target Valuation
SentinelOne was originally seeking to raise roughly $928 million at a value of about $7.36 billion, a June 21, 2021 filing indicated, SeekingAlpha reports. An updated filing on June 28 suggested the target valuation would be even higher — perhaps around $8.11 billion, Reuters estimated at the time.
SentinelOne raised $267 million at a $3 billion valuation in November 2020. At the time, the company said it expected to double its revenue in 2020 compared to 2019.
Note: Blog originally published June 4, 2021. Updated June 21, 2021, with newly disclosed valuation information.