Cloud-data warehousing startup Snowflake went public on Wednesday raising nearly $3.4 billion at $33.2 billion. The maker of cloud-data software made history after its stock popped 104% to $245 in its first trade, making it the biggest opening gain of any IPO since at least 2008, according to data compiled by Bloomberg.
We first wrote about Snowflake in October 2018 when the cloud data warehouse startup was just valued at $3.5 billion after a $450 million fundraise. However, we paid very little attention to the name of the investors. As we reported back then, we said:
“The round was led by Sequoia Capital, with participation from Madrona Venture Group, Redpoint Ventures, Altimeter Capital, Capital One Growth Ventures, Sutter Hill Ventures, Wing Ventures, and Meritech Capital.”
As we later found out, the Palo Alto, California-based Sutter Hill Ventures, which is led by venture capitalist Mike Speiser, was one of the original investors who believed in Snowflake and saw its potential. Sutter Hill Ventures. Just two months after Facebook’s massive IPO in 2012, Speiser led Snowflake’s $5 million Series A in August 2012, betting early on cloud-based data infrastructure.
Between August 2012 through June 2014, the relationship between Snowflake and Speiser grew to a point that he was called to serve as both the CEO and CFO of Snowflake, according to the company’s S-1. Sutter Hill Ventures bet big on Snowflake and its bet is now paying off big time. Sutter Hill now owns 20.3% of Snowflake’s outstanding shares including 49,564,848 shares of Snowflake’s Class B common stock. Altogether, Sutter Hill Ventures is sitting on a stake worth about $12.6 billion from its total investment of less than $200 million.
However, those gains aren’t locked in yet, CNBC Ari Levy cautioned. “The stock jumped 134% on Wednesday to close at $253.93, but the price could swing wildly in the coming months, depending on momentum, company performance, and the broader economy and market, while Speiser is still locked up for at least a few more months,” Levy said.
Even though Sutter Hill is relatively smaller than well-known venture capital firms, its return, for now, is greater than the roughly $7.7 billion Accel had in Facebook stock and proceeds after the IPO, and a historic windfall for an early-stage firm that rarely gets mentioned alongside Silicon Valley’s big names like Andreessen Horowitz, Benchmark, Greylock Partners, and Sequoia (also a Snowflake investor).
In the meantime, Sutter Hill is not the only firm cashing in. Other investors are getting rich on the Snowflake offering as well, including:
- Altimeter Capital owns about 15% of the stock, worth over $9.2 billion
- Iconiq owns 14% valued at $8.6 billion
- Redpoint controls 9% for a stake of $5.6 billion
- Sequoia has 8.6% at about $5.2 billion.
- CEO Frank Slootman‘s 5.9% stake is worth $3.9 billion, just 17 months after joining the company.
- Finance chief Mike Scarpelli, who followed Slootman to Snowflake from ServiceNow, owns 1.9% worth $1.2 billion.
Founded in 2012 by Benoit Dageville, Marcin Zukowski, and Thierry Cruanes, Snowflake Computing is the only data warehouse built for the cloud. Snowflake delivers the performance, concurrency, and simplicity needed to store and analyze all of an organization’s data in one solution. Snowflake’s technology combines the power of data warehousing, the flexibility of big data platforms, and the elasticity of the cloud at a fraction of the cost of traditional solutions.