Cohesity announces huge increase in valuation, goes deeper with partners
Cohesity has announced it has a new valuation of $3.7 billion, which is $1.2 billion higher than its valuation less than 12 months ago.
The valuation was established in line with a $145 million tender offer made by investors to Cohesity employees who want the option to sell a small portion of their equity for liquidity, the company states.
This non-dilutive transaction was led by Steadfast Capital Ventures and supported by a syndicate of new and existing investors, including Premji Invest.
The valuation comes as Cohesity is reporting significant results from its fiscal second quarter ending Jan. 31, 2021.
The company saw year-over-year (YoY) growth in annual recurring revenues (ARR), a continued surge in customer wins globally, and a rapidly increasing number of customers spending $5 million or more in total lifetime spend on Cohesity software.
In addition, Cohesity saw traction across its partner and service provider ecosystem.
Growth by numbers
The following metrics highlight the significant results Cohesity achieved during Q2, its most recently completed quarter.
ARR growth: Cohesity achieved a nearly 90% increase YoY (Q2/Q2) in ARR, further emphasising the success of the company's subscription-based software model.
Net expansion rate: Cohesity's net expansion rate - or the rate of expansion net of churn from existing customers over the last year - continues to exceed 130%, a benchmark for leading subscription/SaaS companies. This means that ARR from Cohesity's existing customer set grew more than 30% over the last 12 months.
Customer growth: Cohesity saw a 50% increase YoY (Q2/Q2) in the number of customers doing business with Cohesity, with rapid adoption in the Americas, EMEA and Asia Pacific/Japan regions. More than 2,300 customers trust their data with Cohesity.
Continued strength among the Fortune 500: Cohesity customers include two of the top five Fortune 500, two of the top five U.S. banks, more than 300 financial services organisations globally, and three of the top five pharmaceutical companies globally.
Growth in customer spend: Cohesity realised an 84% increase YoY (Q2/Q2) in the number of customers that spent between $1 million and $5 million on Cohesity software in total lifetime spend, and a 300% YoY (Q2/Q2) increase in customers with more than $5 million in total lifetime spend.
Success with channel partners: The number of partners that have booked $1 million or more in business with Cohesity grew 46% YoY (Q2/Q2). Cohesity is not only expanding its base of partners, but going deeper as more customers embrace Cohesity's multicloud platform and data management offerings.
Record-breaking quarter with service providers: Cohesity realised its biggest quarter ever with service providers, seeing a 208% growth in bookings YoY (Q2/Q2).
Cohesity also signed 16 new service providers globally in Q2. Cohesity customers span a wide array of verticals including financial services, healthcare, government/ public sector, pharmaceutical, retail, technology, transportation, education, and media and entertainment.
Partner and executive commentary
Steadfast Capital Ventures managing director and head of venture capital, Karan Mehandru, says, "Cohesity is firing on all cylinders with significant increases in annual recurring revenues, exceptional customer and partner momentum, and impressive growth in overall customer spend."
Mehandru says, "The company also continues to introduce software innovations that are transforming data management - including Data Management as a Service.
"This game-changing SaaS technology is unleashing new opportunities for midsize and enterprise customers to simplify data management and do more with their data.
"At Steadfast, our goal is to partner with exceptional entrepreneurs building iconic and durable companies that are built to last, and our partnership with Mohit and the Cohesity team is a shining example of that strategy at work.
Premji Invest managing partner U.S. Sandesh Patnam says, "Cohesity continues to disrupt the data management market. The Cohesity Helios multicloud data platform uniquely empowers organisations to easily manage their data, mitigate the risks of ransomware attacks, eliminate infrastructure silos, and solve mass data fragmentation.
"Given Cohesity's continued innovation, excellent NPS customer support scores, strong leadership, and vision for the future, we are very optimistic about Cohesity's continued success in the market. We believe the new valuation is a fraction of the value Cohesity will be worth long-term.
Cohesity CEO and founder Mohit Aron says, "We are pleased to enable this liquidity opportunity for our employees.
"We believe the oversubscribed, non-dilutive tender offer based upon this increased company valuation speaks volumes about Cohesity's performance and future outlook as the leading, modern data management company.
