Several aspects suggest that Snyk, the developer security startup most recently valued at $7.4 billion, will soon go public.
According to The Information, an IPO prospectus was drafted in January 2024 and should be filed inside a number of months reported. The company also recently reached $300 million in ARR and is on course to be money flow positive in 2025, in accordance with CEO Peter McKay posted on LinkedIn earlier this week. Added to that is general optimism a few friendlier regulatory environment under President Trump.
However, in a commentary exclusively for TechCrunch, McKay says Snyk isn't rushing the IPO.
“We have $435 million within the bank and are near breaking even. We won't be burning money in 2025, so I can select when to go public. I don’t should rush,” he said.
While McKay expects regulatory conditions to enhance next yr, he expects 2026 to be much more favorable.
“I feel the brand new administration will make things a bit easier on each IPOs and mergers and acquisitions. We imagine 2025 can be higher and 2026 can be even higher,” he said. “Internally, we feel we’re ready (to go public). From the surface, I feel we’re watching.”
Snyk, which alerts developers to potential problems while coding, has raised over $1 billion burned about $173 million in 2023 The company announced. McKay says he expects to chop losses by half in 2024 and break even next yr.
But Snyk isn't backing down on its strategy of acquiring smaller development security firms like Helios this yr and DeepCode in 2020, each for undisclosed amounts. Snyk Credits DeepCode for being the backbone of an AI product that recently achieved over $100 million in ARR alone – a 3rd of Snyk's total revenue.
“I feel the one place we're going to burn money is in acquisitions,” McKay said.
There is a variety of hype around AI coding tools replacing developers, which could someday be an issue for Snyk's business model. However, in accordance with McKay, Snyk has seen a rise within the variety of developers using its platform over the past 12 months.
And the more programmers depend on AI to jot down the code, the higher it may very well be for the corporate. McKay estimates that AI-generated code has 30 to 40% more vulnerabilities, especially when utilized by junior developers. This offers more possibilities for Snyk's security tools.
“It was definitely a tailwind,” he said.
