The IPO rush from 2021 continued this week with a new filing from NoSQL provider Couchbase. The company raised hundreds of millions while it was private, making its upcoming debut an important moment for a number of private investors, including venture capitalists.
According to PitchBook data, Couchbase was last valued at a post-money valuation of $ 580 million when it grossed $ 105 million in May 2020. Despite its extensive fundraising history, the company is, to the best of our knowledge, not a unicorn making its debut.
We want to find out if it will be when it evaluates and starts acting, so we looked at Couchbase’s business model and financial performance in hopes of better understanding the company and its market conditions.
The Couchbase S-1
The Couchbase S-1 filing describes a company that sells database technology. Specifically, Couchbase offers its customers a database technology that includes what NoSQL can offer (“schema flexibility”, as the company puts it) as well as the option of questioning their data with SQL queries.
Couchbase’s software can be deployed in clouds, including public clouds, in hybrid environments, and even on-prem setups. The company sells to large corporations and is attracting 541 customers by the end of fiscal 2021 who had annual recurring revenue (ARR) of $ 107.8 million by the end of last year.
Couchbase divides its earnings into two main areas. The first, the subscription, comprises software license revenue and what the company calls “support and other” revenue, which it defines as “postal contract support” or PCS, a package of offerings including “support, bug fixes, and the” entitlement to unspecified software updates and upgrades ”for the duration of the contract.
The company’s second revenue segment is services that are self-explanatory and lower-margin than the subscription products.