Cybersecurity firm SailPoint has made its return to the public market, pricing its initial public offering (IPO) at $23 per share, the highest in its expected range. The move raised $1.38 billion, marking it as the first major tech IPO of 2025. Before the IPO, SailPoint was valued at $12.6 billion, while its closest competitor, Okta, was valued at $16.8 billion.
CEO Mark McClain expressed confidence in the company’s position, stating that investors are seeking firms with steady growth and profitability, qualities SailPoint meets. He believes the firm is well-positioned to attract these investors.
A Return to Public Markets
SailPoint has experience with public markets. The company first went public in 2017. At that time, its IPO price was $12 per share. On the first day of trading, its stock gained 8.3% and closed at $13.
In 2022, private equity firm Thoma Bravo acquired SailPoint. It paid $6.9 billion, or $65.25 per share, to take the company private. Now, after two years, SailPoint is once again a publicly traded firm.
Financial Performance
SailPoint has grown significantly since its first IPO. It now operates as a software-as-a-service (SaaS) company. For the year ending January 31, 2025, the firm expects its annual recurring revenue to reach $875 million to $877 million. This marks a 41% increase from the previous year.
However, SailPoint is still operating at a loss. In the first nine months of 2024, its net loss was $235.8 million. This is an improvement from the $308 million loss recorded in the same period the year before. McClain emphasized that the company is profitable on a non-GAAP basis.
SailPoint’s public return comes with a unique structure. Thoma Bravo will maintain 88% ownership of the firm. This means the private equity company will control board decisions. It will also have the power to nominate board members.
A Test for the IPO Market
SailPoint is the first major test for tech IPOs in 2025. Analysts expect many big names, like Stripe, to go public this year. They predict a strong IPO market, with many firms seeing opportunities under the current administration.
Renaissance Macro expects a high number of IPOs in 2025. Experts believe between 155 and 195 companies will enter the market. These firms could raise between $40 billion and $55 billion.
McClain said that the regulatory environment may become more business friendly. He believes there will be fewer regulations on companies. This could create a positive atmosphere for new IPOs.
IPO Market Recovery
The IPO market has shown improvement. In 2024, IPO numbers rose by 38%. The funds raised from IPOs increased by 48%. The overall performance of IPOs also improved. The average gain for IPOs raising over $50 million was 30%.
In total, 176 U.S. companies went public in 2024. These IPOs raised a combined $33 billion. Analysts say this is a sign of growing investor confidence.
What’s Next for SailPoint?
SailPoint now faces the challenge of proving itself to investors. The company has shown strong revenue growth. However, it must work toward consistent profitability. With Thoma Bravo holding most of the shares, the company will have stable leadership.
McClain remains optimistic. He believes investors see SailPoint as a strong, growing company. He expects the firm to benefit from increased demand for cybersecurity solutions.
SailPoint’s return to the public market is significant. It marks the start of what could be a strong year for IPOs. With tech companies eager to go public, all eyes will be on SailPoint. Investors will be watching closely to see how the firm performs in its second run as a public company.
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