Snowflake Computing Inc. jumped into the public market Wednesday with an initial public offering, watching shares more than double in value, to $245 a share, in their initial trading on the New York Stock Exchange.

The first-day pop of more than 104%, while leaving a lot of money on the table that the company could have raised with a higher initial stock price, still raised nearly $4 billion, making it the largest U.S. software IPO in history. At the current price, Snowflake is valued at a stunning $68 billion.

Update: Shares closed up almost 112%, to $253.93 a share, for a market capitalization of $70.4 billion.

The company’s welcome reception by investors demonstrates the ascendancy of software and services for cloud computing. A number of other cloud-based companies are going public this week, including JFrog Ltd. today and Sumo Logic Inc. Wednesday night. Next week, Asana Inc. and Palantir Inc. are expected to go public.

“The market for enterprise software continues to be larger than most anticipate,” Aaron Levie, chief executive of Box Inc., said in an interview with SiliconANGLE this week. “It’s really a constant train pushing forward.”

Snowflake, which sells cloud-based software for storing and analyzing data, had offered 28 million shares late Tuesday at $120 apiece, raising close to $4 billion and valuing the company at $33.3 billion. Investors were already anticipating a blockbuster opening day for Snowflake, which had already raised its anticipated price range from a maximum of $85 to $110 within a week of announcing its IPO plans.

Indeed, the company has already gotten the backing of prominent investors including Warren Buffett’s Berkshire Hathaway Inc. and Salesforce.com Inc., which have each agreed to purchase $250 million of its stock at the IPO price in a concurrent private placement. Separately, Berkshire Hathaway has also agreed to buy an additional 4.04 million shares in a secondary transaction from former Snowflake Chief Executive Bob Muglia. It will pay $484.8 million for those shares based on the IPO price.

Israeli software company JFrog, which provides a platform to automate the creation and deployment of software, also late Tuesday priced its own shares at $44 a share, above its already raised range of $39 to $41. It was also set to start trading Wednesday morning under the ticker symbol “FROG.” The IPO offered 11.6 million shares, raising $510.4 million.

Update: On Wednesday, JFrog’s shares also rocketed, as the first trade came in at $71.27 a share. The stock closed up 47%, to $64.79 a share, giving the company a valuation of $5.7 billion.

As for Snowflake, the enthusiasm from investors is no surprise, since there is lots to like about Snowflake, which sells technology that enables customers to analyze and share vast amounts of data that’s stored in the cloud more quickly than relying on traditional databases tied to on-premises hardware.

The company is generating more than $1 billion in annualized revenue, and grew by more than 130% in the first half of this year alone. Meanwhile, its gross profit has tripled during the same time frame, an encouraging sign for investors as it shows the company can generate more earnings as it grows. Snowflake counted more than 3,110 paying customers as of July 31, including 146 of the Fortune 500.

Analyst Charles King of Pund-IT Inc. told SiliconANGLE that Snowflake was getting so much attention because it’s one of the few startups around that qualifies as what you might call “cloud computing for adults.”

“Rather than being a high-flying start-up piloted by tech-savvy, whiz-bang youngsters, Snowflake’s founding CEO was Bob Muglia, who had a long, storied and highly successful executive career at Microsoft, mainly leading business-focused product teams,” King said.

When Muglia departed, he was replaced by yet another experienced CEO in Frank Slootman, who previously led ServiceNow Inc. through its own IPO. King said that means Snowflake has had an understanding of enterprise-class computing and services built into its DNA since the very beginning, and that’s something investors will value.

“The news that Berkshire Hathaway and Salesforce have both taken stakes in the company reinforces that point,” King said. “In other words, it’s reasonable to assume that Snowflake knows and has what it takes to deliver on its promises. In highly uncertain times, that kind of rep is pure gold.”

Indeed, Rob Woollen, co-founder and chief technology officer of Sigma Computing Inc., who was involved in the early days of Snowflake as an entrepreneur in residence at early investor Sutter Hill Ventures, told SiliconANGLE that it’s no wonder Buffett broke his rules to invest early in the company.

“Companies have been chasing the data-driven dream for more than a decade now and Snowflake finally provided the foundation needed for it to actually be possible,” he said. “Making more data from more sources available to more people is the only way for companies to truly harness the full power of data. This is a huge day for all of them, but it is also an exciting day for just about every cloud data company.”

Analyst Holger Mueller of Constellation Research Inc. added that Snowflake is a great example of how to reinvigorate the delivery of an old and known technology by basing it in the cloud. “Snowflake has done that, taking advantage of the elasticity and pay-as-you-go nature of the cloud, so congratulations on what should be one of the most successful IPOs of 2020,” he said.

Snowflake is entering a stock market that has a huge appetite for high-growth, cloud-based software firms, many of which have managed to grow during the coronavirus pandemic. The Nasdaq index, which is focused on publicly traded technology firms, is up more than 25% this year versus a 4.5% gain for the S&P 500.

With reporting from Robert Hof

Image: Snowflake