Last year, I met up�with the co-founder of Splunk, Erik Swan, as well as the company�s CEO, Godfrey Sullivan. While at the headquarters, I saw a group of auditors working diligently. Splunk already was acting like a public company.
Well, last week Splunk filed the necessary papers with the SEC for an initial public offering. The underwriters include Morgan Stanley (NYSE:MS), Credit Suisse (NYSE:CS), JPMorgan Chase (NYSE:JPM) and Bank of America (NYSE:BAC). The proposed ticker symbol is “SPLK.”
Splunk develops software tools that make it easy for companies to analyze their data. In a way, it�s like using Google�s (NASDAQ:GOOG) search engine. With Splunk, you can find the source of a problem — say a security breach — or monitor customer actions. And this is all done in real-time.
A key to Splunk�s success is its thriving developer community. There’s now more than 300 apps for things like reports, alerts and dashboards.
Splunk also has built several premium add-on products. These include Splunk for Enterprise Security, Splunk for PCI Compliance and Splunk for VMware (NYSE:VMW). However, the most promising may be an application for the cloud, called Splunk Storm.
No doubt, Splunk has had little trouble finding customers — the base is now more than 3,300. Some of the big ones include Bank of America, Comcast (NASDAQ:CMCSA), Salesforce.com (NYSE:CRM) and Zynga (NASDAQ:ZNGA). They pay a licensing fee that is based on the estimated indexing capacity needs.
In terms of growth, Splunk has been on a tear. From fiscal 2009 to 2011, revenues soared from $18.2 million to $66.2 million, which is a year-over-year growth rate of 93%. For the first nine months of 2011, revenues rose by 79% to $77.8 million, but the company still had a net loss of $9.7 million.
Splunk actually would be an attractive buyout candidate for a large software operator like Oracle (NASDAQ:ORCL), IBM (NASDAQ:IBM) or Microsoft (NASDAQ:MSFT). And this might be the ultimate outcome. After all, Sullivan�s last stint was at Hyperion, which he sold for $3.3 billion in 2007 to Oracle.
In the meantime, it looks like Sullivan thinks Splunk has much more value as a public company.
Tom Taulli runs the InvestorPlace blog�IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of��All About Short Selling��and��All About Commodities.��Follow him on Twitter at�@ttaulli. As of this writing, he did not own a position in any of the aforementioned securities.
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