September 17, 2019 / 1:19 PM / a month ago

GitLab raises $268 million in funding, may look at direct listing

(Reuters) - GitLab said on Tuesday it had raised $268 million in its latest round of funding, taking the valuation of the U.S. coding platform to $2.75 billion in its run-up to a stock market launch next year where it might opt for direct listing.

Several technology companies such as Spotify (SPOT.N) and Slack Technologies (WORK.N) have chosen the direct listing route to go public, a process in which no new shares are created and the company saves millions of dollars in underwriting fees.

“It might be possible to do a direct listing instead of an initial public offer, so we are still deciding between that,” Co-founder and Chief Executive Officer Sid Sijbrandij told Reuters.

GitLab, whose online tools are used by coders and IT professionals to collaborate, counts U.S. carrier Verizon (VZ.N), e-commerce company Alibaba (BABA.N) and Wall Street bank Goldman Sachs (GS.N) among its customers.

The company became a unicorn, a start-up with a valuation of more than $1 billion, after raising $100 million last year.

CEO Sijbrandij said the company’s revenue was growing at more than 140% year-over-year, but declined to disclose the revenue number or further details on growth.

“We are not profitable and that’s a big reason we are raising money,” Sijbrandij said. “We are also not cash flow breakeven, but our margins are way north of 80%.”

GitLab’s latest funding round included investments from Adage Capital Management, BlackRock Inc, Franklin Templeton, Light Street Capital and Tiger Management Corp, Two Sigma Investments.

The company received initial backing from the startup accelerator Y-Combinator, known for incubating home renting company Airbnb and social media platform Reddit, and started with $1.5 million in seed funding in 2015.

It currently employs 800 employees in over 55 countries and counts more than 100,000 companies as its customers.

Reporting by Supantha Mukherjee and Neha Malara in Bengaluru; Editing by Arun Koyyur

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