Rubrik: Benefits of staying private

Rubrik, founded in 2013, has quickly established itself as one of the leaders in cloud data management and cybersecurity. Since its inception, the company has attracted significant investor attention and received $752 million in an initial public offering, becoming one of the “unicorns” in the technology industry.

Rubrik remained a private company for more than 10 years until 2024. Using Rubrik as an example, let's examine why it is now beneficial for technology companies to remain private for as long as possible.

Changes in the investment market

Along with the rapid growth in the number of investors, the new decade was marked by an increase in the popularity of investments in private companies (Private Equity). Even 20 years ago, the market situation was significantly different from the current one. Investments in private companies were mainly made by venture capital funds, while retail investors, banks, insurance companies, and other significant players traditionally bought shares on the stock exchange. Today, the volume of investments in private equity has increased 8 times compared to 2000, whereas in the stock market, it has increased only 3 times. The number of investment funds specializing in such investments has also increased: if 10 years ago they managed assets worth $1.6 trillion, then in 2020 — by $4 trillion.

Focus on innovation without the pressure of the public market.

By remaining a private company, Rubrik could focus on innovation and product development without being distracted by quarterly reports and stock fluctuations that often accompany public companies. This allowed the company to quickly adapt to changes in the market and respond effectively to customer needs without additional pressure from shareholders.

Attracting and retaining talent

Rubrik attracted highly qualified personnel, offering them the opportunity to work in a dynamic and innovative environment. The company's private status provided greater stability and predictability in career growth, unlike public companies, where much depends on market fluctuations.

Resistance to market fluctuations

In conditions of unstable markets and economic uncertainties, private companies have better protection from external shocks. They are not subject to pressure from public investors and analysts, which allowed Rubrik to implement long-term development strategies without fear of short-term shocks.

Flexibility of financing and investments

Rubrik could choose the funding sources that best fit their strategic goals. This included attracting private capital, venture capital investments, or debt financing, which were more affordable and less burdensome than funds received from public auctions.

The decision to launch an IPO?

Launching Rubrik's IPO was based on several essential achievements the company has realized over 10 years of successful operation. The main factor was the maturity of the business: the company has a stable business model, predictable sources of income, and a clear strategy for future development. This ensures readiness for additional investments and scaling after the public offering of shares. Over the same 10 years, the company has developed an experienced management team that can effectively manage the IPO process and the subsequent activities of the company as a public one. In addition, being in the status of a private company, Rubrik had the opportunity to independently determine the optimal time to launch an IPO without experiencing external pressure.

IPO results

23.5 million securities were sold, and the placement price was $32 per share — above the initially announced range of $28-31. Rubrik's value from the IPO is estimated at about $5.6 billion. Following the results of the first day of trading, Rubrik shares rose by almost 16% to $37.

Kazakhstani investors

The investment of $1.4 million by Kazakhstani investors in Rubrik at the pre-IPO stage is a landmark event for our investment community. This demonstrates our investors' strategic vision and highlights their ability to participate in significant international projects. Our support has helped Rubrik remain a private company for 10 years, which in turn has allowed them to strengthen their market position and continue their innovative activities without the immediate pressure of the public market. This case illustrates Kazakhstan's growing role in the global investment arena and our potential to contribute to the development of high-tech companies around the world.

Source: Bluescreen.kz

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