Hadoop vendor MapR raises another $50M as it sets its sights on IPO

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The use of Hadoop-based open source big-data technology continues to grow among enterprises, and today MapR Technologies, one of the bigger startups in the space, has announced another $50 million in funding to secure its place as a leading vendor and gear up for an IPO.

The investment is being led by Future Fund — Australia’s sovereign wealth fund — and also includes participation from MapR’s existing investors Google Capital (which led its last round of $110 million), Lightspeed Venture PartnersMayfield FundNew Enterprise Associates, Qualcomm Ventures, and Redpoint Ventures.

MapR is not disclosing its valuation, CEO and founder John Schroeder told me in an interview.

“I’m having fun running a private company for a little bit longer,” he said. “But the valuation was driven around comparative valuations for companies like Splunk [which is currently valued at $8.44 billion].” By this, he means something broader than a straight Hadoop play. “It’s a broad platform”

He also debunked the idea of how many companies do tout valuations without explaining what is behind them. “Many of the funding rounds have terms, and I could dial in any valuation I want with ratchets. Valuations can be very misleading,” he said, adding that the only thing more he would say about it is this: “Our cap table is in fantastic shape and way better than many other companies that went public recently, and employees will benefit from a future IPO because of that.

For some context, MapR’s last round valued it at more than $1 billion. The company has now raised $194 million to date in equity, with another $30 million in debt financing.

The Hadoop market is largely a three-horse race between MapR, Cloudera and Hortonworks. Cloudera has to date raised over $1 billion; and while Hortonworks had a strong public listing debut in 2014, it has more recently been taking a hit after missing analysts’ estimates and reporting widening losses earlier this month (its market cap is currently around $435 million).

With that in mind, MapR — which also taps and converges data in Spark and NoSQL, among other technologies — is in a somewhat enviable position: the company is growing well while steering clear of some of the pressures that might come with larger a financing load or a public-company profile.

MapR describes its last quarter as a “record” for the company, with a 100 percent increase in bookings compared to a year ago, with licenses and support agreements (the mainstay of the company’s business model) accounting for 90 percent of total bookings. It also said it had “multiple” license transactions of $5 million or more, although it doesn’t spell out total revenues.

Its customer list includes a strong roster of large corporations — underscoring just how widely used Apache Hadoop-based big data services are becoming. They include American Express, Audi, Ericsson, JLL, Mizuho Bank, NTT, Philips, Qualcomm, and Rubicon Project.

“Our ongoing momentum is fueled by a world-class team that is driving innovation and growth across every facet of our organization,” said Schroeder in a statement. “This new funding strengthens our balance sheet as we look ahead to an initial public offering.”

IPO is in the cards

On the subject of an IPO, the company has been making some noises already this year, and tody Schroeder told me that a likely date at the moment appears to be the beginning of 2017.

“We’ve been beating [our and investors’] expectations for many quarters, and we should be in a position for an IPO by the beginning of next year,” he said. “We’ve been encouraged by Twilio and Talend. Investors want to put money to work; they just want the right companies to to invest in.”

Perhaps more interesting is the fact that MapR is keen on an IPO at all.

“The investment bankers we’re working with come by with pitchbooks, and ask us, ‘why would you want to go public anyway?'” he said when I asked him the same question.

“Historically it’s obvious. It’s a marketing event, it gives you access to more capital and the transparency can be a positive thing if you have good results. But today it is a harder question because you have many companies like the Uber’s of the world that are changing the rules. I scratch my head about what makes the most sense. I still think the norm will be that the majority of companies will go public and maybe we’re just going through a phase where they are not.”

As for why it chose to tap Australia’s sovereign wealth fund for this latest funding round, Schroeder says it fit both with the Future Fund looking to expand its investment activities, and MapR doing a lot more on the investor relations front lately, speaking with LPs at the VCs that already back MapR.

More generally, the company opened offices in the country in 2014 to serve Australia and New Zealand, and it has been making moves to establish itself as a key partner for businesses opting to use Hadoop-based big data analytics as part of their operations.

“Enterprise computing is going through one of the biggest transformations in decades and companies that are serious about leveraging data as a disruptive advantage are relying on MapR,” said Barry Eggers, managing partner, Lightspeed Venture Partners, in a statement. “The company has consistently demonstrated strong growth over several years and we believe its technology lead will continue to drive its success.”

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