Some things are worth waiting for. Nutanix kept watchers waiting an eternity for its IPO but early trading has seen the company more than double in value since its Friday debut to give the datacentre infrastructure disruptor a market cap north of $5bn at time of writing. For comparison that’s twice the value of Pure Storage and more than six times Nimble Storage – other datacentre companies, both of which have gone public in recent years – or about half the scale of an incumbent, NetApp. The splashy debut will give investors hope that the markets are once more smiling on technology ventures and that the days of ‘tech is dreck’ in IPOs are over. For IT buyers, having one of the most interesting B2B tech companies of recent years established as a public company might make Nutanix a safer purchasing investment that’s palatable to board members.
CEO Dheeraj Pandey has been eyeing these days for years now. I first met him in the spring of 2013 and one of the first things he discussed was the state of the IPO market and Nutanix’s chances of floating one day. In the same way that many Silicon Valley companies are “built to flip” – that is they are designed with a quick exit in mind – Pandey’s company was built to float. Back then he had an encyclopaedic knowledge of the valuations of rivals, their challenges and their opportunities. And he already was suggesting that Nutanix would be worth more than the $1bn or $2bn range of some market caps in the sector.
The commercial narrative was strong, the sound bites sharp, the PR incisive and the swagger justified. A senior marketer at a large enterprise software company recently bemoaned his company’s marcomms materials compared to those of Nutanix. And the fact that the product is liked and admired doesn’t hurt….
Nutanix’s rise to eminence will be welcomed by others in the sector, most notably the company that is arguably most similar, SimpliVity.
“The hyperconverged infrastructure industry is seeing unprecedented growth, and Nutanix’s IPO further validates that the market is moving toward greater mainstream adoption,” SimpliVity CEO Doron Kempel told me in an email.
“Hyperconvergence has moved from solving niche use cases to large, enterprise-wide transformations, providing comprehensive data services and consolidating entire multi-national data centers into just a few racks. It is these types of deployments that best demonstrate the full potential of hyperconvergence, and SimpliVity is leading the way to this transformation.”
Of course, share prices go up and down and there’s no guarantee that Nutanix won’t slip, but for now at least the bull is in the ascendant and the bear has retreated.
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