- Data analytics company Datadog went public on Thursday, and its stock rose 39% in the first day of trading.
- DataDog was last valued privately at $7.83 billion, but should see a richer valuation than that when the markets open on Friday.
- Datadog co-founder and CEO Olivier Pomel says that hiring is the company’s top priority with the IPO out of the way.
- He also said that DataDog’s roadshow took an unusual turn: The company interviewed potential investors to make sure they understood what they were getting themselves into.
- Pomel says that Datadog’s focus on making its products accessible to as many customers as possible helps it take on competitors like IBM, HP, Broadcom, and Splunk.
- Click here for more BI Prime stories.
The data analytics company Datadog soared 39% on its first day of trading on Thursday.
Last privately valued at $7.83 billion, Datadog had previously raised money from the likes of OpenView Venture Partners, RTP Ventures, and Index Ventures. Earlier this month, Bloomberg reported that Cisco was willing to acquire Datadog for a premium price, but Datadog passed.
Now, Datadog has gone public, and co-founder and CEO Olivier Pomel says he thinks Datadog can “grow a lot more as a company.”
“We have some good proof points around the product and what we can do,” Pomel told Business Insider. “The IPO is not an end in and of itself. We will go to business and really fully chase the opportunity of the massive transformation of companies moving from legacy IT to public and private cloud.”
Pomel says Datadog plans to build more products, but his top priority is around hiring. He says everything, including building products, selling to customers, and operating the business flows from hiring, training, and retaining employees.
“Now, I don’t spend my days doing any building myself,” Pomel said. “I don’t spend my days pitching my company to investors. I spend my days making sure we hire people well.”
A ‘mad dash’
As Datadog geared up for its IPO, Pomel says the last two weeks on the roadshow have been a “mad dash.” As is usually the case with these roadshows, Datadog answered plenty of investor questions about the company and why Wall Street firms should invest.
But Pomel also says that Datadog did something just a little different on its roadshow: It interviewed investors to see how well they understand the company and its long term plans.
“There’s a good amount of time that goes into how to present the business to the outside world so investors can understand what it’s about and what matters and how to model the business,” Pomel said. “One thing that’s important about your IPO is it’s the last time you get to pitch your investors. You try to set yourself for success by having your investors understand your business.”
Now, Datadog joins a host of enterprise software companies that have gone public this year, including Zoom, PagerDuty, CrowdStrike, Slack, and Dynatrace. It’ll also continue to compete with rivals like IBM, HP, Broadcom, and Splunk — many of whom are larger and better funded.
However, Pomel says that he’s not especially worried: As the cloud computing market continues to grow, so too will demand for DataDog’s services, he says — DataDog is especially well-suited to helping users track and improve the performance of software running in the cloud.
Read more: 11 enterprise rock stars that have quietly been responsible for some of the most successful cloud services in the world
“It’s a very big market,” Pomel said. “The world is transitioning from legacy IT to public and private cloud. It’s going to grow and grow and grow for many years. It’s not a winner take all market.”
Pomel says that Datadog has a different approach to its competitors, as well. He says that its software is easy to use, such that any customer can pick it up and experiment with how best to use it.
A ‘consistent’ vision
Shardul Shah, partner at Index Ventures and a Datadog board member, says that although the company has grown, two big things have stayed the same.
“What stayed the same is, number one, the company has been relentlessly focused on customer value,” Shah told Business Insider. “Second, they’re addressing a ubiquitous need. Cloud migration and the requirement for collaboration is persistent across every industry. As a consequence, I’m looking forward to that combination as a persistent and deep need for driving business.”
Shah says that one challenge companies face as they grow is “not sticking to their vision,” but he’s not worried about Datadog.
“What I have confidence in is Olivier’s vision has always been consistent,” Shah said. “I think these themes of businesses organizing teams to collaborate will be persistent. That Datadog has been able to go public shows how pervasive those things are and how important customer experience is.”
Pomel adds that Datadog has come a long way since it first started in 2010. In 2012, it released its first cloud monitoring product. Since then, it has added app performance monitoring and log management products to its product lineup.
“We take it from the perspective of taking as much data as possible from different titles and making it accessible to as many people as possible,” Pomel said. “Our focus is to get as broadly adopted as possible as opposed to being specialized on specific use cases that are then going to be used by tiny, tiny subsets for the workforce.”
SEE ALSO: A quantum computing startup that spun out of a Harvard lab just came out of stealth mode with $2.7 million in seed funding from investors like Samsung
Join the conversation about this story »
NOW WATCH: What El Chapo is really like, according to the wife of one his closest henchman