UPDATED 09:30 EDT / AUGUST 09 2016

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MapR raises another $50M, says IPO goal is in sight

Big data platform vendor MapR Technologies Inc., has raised another $50 million, bringing its total funding to $194 million and giving it the runway executives said it needs to get to an initial public offering (IPO).

Both the timing and the amount seem tuned to get to the finish line without losing control of the timetable. Companies that take on massive amounts of funding can come under excruciating pressure from investors to go public, and this year’s markets have hardly been hospitable. “We believe we could have run without any additional funding through calendar 2017,” said Matt Mills, president and chief operating officer. “But we didn’t want to be in a position where we needed money and the conditions weren’t good. We feel like we’ve bolstered our balance sheet and give us time to take the company public based on the markets.”

Timing the market has been tricky this year, with startups raising unprecedented amounts of capital, but almost no IPO activity.  In fact, the first tech IPO of the year – Dell Inc.’s Secureworks Corp. subsidiary — stumbled on its first day of trading and is still mired below its offering price. Talend SA gave market something to cheer about late last month when its stock surged by more than 50% on the first day of trading, but the price has stalled since then.

Without tipping its hand on revenues, MapR did share some good words about its growth, saying that it more than doubled bookings in the second quarter, compared to last year. Licenses and support agreements for the MapR Converged Data Platform represented 90 percent of total bookings, indicating that the company is not overly dependent upon low-margin services revenue. MapR also reported a 99 percent customer retention rate and said the average new customer expands its spending with the company by 143 percent during the ensuing 12 months.

New and expanded customer accounts during the most recent quarter include American Express Co., Audi AG, LM Ericsson Telefon AB, Jones Lang LaSalle Inc., Koninklijke Philips N.V./Royal Philips, Qualcomm Inc., and The Rubicon Project Inc.

The latest round was led by Future Fund, with participation from all existing investors, including: Google Capital, Lightspeed Venture Partners, Mayfield Fund, New Enterprise Associates Inc., Qualcomm Ventures, and Redpoint Ventures.

Mills said the IPO market has improved with valuations reaching seven to nine times trailing revenues, up from about one-third of that early in the year. “We’ve got a good balance sheet and we’re on a really good track to positive cash flow,” he said. “We’d like to see valuations a bit higher, but we want to be sure we’re in good shape when the market is ready to yield a fair valuation.” He estimated the company would be cash-flow-positive within four quarters after going public.

Last week’s disappointing earnings report by Hortonworks, Inc. can’t have helped, but Mills said that company’s problems are inherent in its business model and not indicative of the health of the industry.

“Companies that are 100 percent open source struggle a bit to sustain growth,” he said. “If anything, their results validate our model. They are 100 percent services. We’re 90 percent software and 10 percent services.”

If anything, customers are asking for better integration, and want to spend less time piecing together open-source components, said Jack Norris, senior vice president of data and applications. “They’re moving away from applications that dictate how data is stored to having a robust platform and bringing processes to it,” he said.

Photo by Raido via Flickr CC

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