Tag Domo

Posts: 2

Who has the biggest...raise?

Venture Beat had an interesting article about Domo's recent raise, Tableaus's disappointing market guidance, and Slack raising $ to a possible $5 Billion valuation. The one thing I got out of all this is the following:

Beyond the money needed to invest in the business, one can begin to see that these crazy financing rounds maybe be as much about making a statement. If you’re making purchasing decisions and you glance around at a bunch of companies that each are only a few years old, you start to wonder which one might be around for the long haul.

Making a statement? Yes, it does make a statement but it sure sounds like a pissing match to me. It reminds me of Dot Com era and how eerily similar all these "massive" raises are, how insane this market is right now.

Call me cynical but I don't believe that this time it will be different. Sure VC's now invest in companies that actually show a revenue stream (something that wasn't necessarily true during the Dot Com days) but you can still "over pay" for something.

Only time will tell and the market will discount prices. There is so much pressure to preform that even just a small hiccup in future earnings guidance can slash market valuations. Just look at Tableau's performance once reality caught up with it. It's now trading below it's IPO day opening price of $47.

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Domo: We Didn't Need the Money

If you work at a startup eventually some of your colleagues will leave for another startup. Some of my old colleagues are now at startups like Fuze, Continnum and Domo, so I keep a lazy eye on any news from those companies. Yesterday a Series D raise was announced for Domo. It was in the amount of $131 Million. Wow.

Utah-based Domo has been a force in the enterprise space for a few years with its data management platforms, but the team is poised for growth with an additional $131 million in Series D funding from existing and new investors, including BlackRock, Credit Suisse and others. These $131 million are an addition to Domo’s previously announced $200 million Series D round. The company says it is now valued at $2 billion.

You read that right, the company is now valued at $2 Billion dollars. The best part? CEO Josh James says they "didn't need the money."

“We didn’t need the money,” Domo founder and CEO Josh James said of the funding round. He called it a “nice buffer,” but insists that the team didn’t require the cash and plans to go public within the year. via TechCrunch

I get that having extra money is a "nice buffer" but what about the terms? Unless the money was given to you with very little strings attached, money raises always come with terms.

So what gives? It might have to do with a messaging service that their offering on their recently released app store. It's too early to tell but this could be a shot at Slack. The $131 million is about 38% of the total raise that Slack ($339 million) got so far. If Domo is going after them, then this "needless raise" is a good start.

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Neural Market Trends is the online home of Thomas Ott.