S1 filing here:<p><a href="http://www.sec.gov/Archives/edgar/data/1404655/000119312514320044/d697256ds1.htm" rel="nofollow">http://www.sec.gov/Archives/edgar/data/1404655/0001193125143...</a><p>Hubspot has always been a high burn rate business and it looks like it may be catching up to them. According to TechCrunch (<a href="http://techcrunch.com/2014/08/25/with-money-tight-hubspot-looks-to-tap-public-markets/" rel="nofollow">http://techcrunch.com/2014/08/25/with-money-tight-hubspot-lo...</a>):<p>HubSpot’s slim cash load and expanding losses — the firm had a deficit attributable to common shareholders of $16.37 million in the first six months of 2013 — are contravened by its rising revenues: HubSpot had revenue of $51.27 million during the first two quarter period of the year, compared to $35.08 million in the preceding-year calendar period. HubSpot’s days of hyper-growth appear to be mostly behind it.<p>The theory is that they can control their burn rate and become profitably, but I am not so sure. As great as their software is, selling marketing software is a tough business and there is a lot of competition. Their S1 filing seems to indicate that they plan on keeping the burn rate high after the IPO in order to compete.
This is a good company. Just look at the numbers. Revenue is growing really well. Their biggest expense is head-count and this year they will almost break even (they are on route to 105M). This will also be the year were expenses growth will be the smallest(23%). 2013 they simply grew very fast - which was quite expensive (59% increase).<p>This year they are growing revenue really well, while their expenses are moderately increasing(less than half of last year). There is a very clear path to profitability in less than 24 months.<p>Revenues:<p>2011 —> 2012 -—> 2013 -—> 2014<p><pre><code> 80% -—> 50% —-> 35%
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Costs:<p>2011 —> 2012 —> 2013 ——> 2014<p><pre><code> 35% —> 59% ——> 23%</code></pre>
I loved this bit from the TechCrunch article:<p>"The stock market has shown something akin to reticence in recent quarters when it comes to companies looking to go public that have large, sustaining losses."<p><a href="http://techcrunch.com/2014/08/25/with-money-tight-hubspot-looks-to-tap-public-markets/" rel="nofollow">http://techcrunch.com/2014/08/25/with-money-tight-hubspot-lo...</a>
The only thing I know about they are the projects[1] on github on frontend stuff.<p>Their odometer[2] saved me on my last project, bussiness people love it.<p>1 - <a href="http://github.hubspot.com/" rel="nofollow">http://github.hubspot.com/</a>
2 - <a href="https://github.com/HubSpot/odometer" rel="nofollow">https://github.com/HubSpot/odometer</a>
These are honest questions:<p>1) Why should the public fund a company that could not get to profitability before its IPO?<p>2) Why, in public markets, a business with $1B in revenue and $10M in net loss has a higher valuation than a business with $30M in revenue and $10M in net income?
Hubspot has a ton of assets to speak of that are taking off and not yet monetized at all or to their full capacity. Inbound.org, for instance is the HN for inbound marketing and has attracted a huge user base in their short existence. Tons of plans to monetize that and of course, drive more customers to their services.<p>They also have a great conference, coming up I beleive in Boston that is also not too shabby. Their content brand is also very much on point, their blog is a huge resource and ranks for basically any inbound/SEO type of query you could think up.<p>I'm not trying to argue against their profitability or growth, but Hubspot is a good company that has a lot of tricks up their sleeve. Dharmesh is also an extremely savvy individual who has elected a very capable CEO.<p>I don't know if I'd buy shares of Hubspot or not, but I will keep my eye on them.
As a bootstrapped startup I was a bit skeptical of their pricetag but once I dedicated a full time person to train and exclusively work on it I've been incredibly impressed. Huge ROI and a strong increase in inbound leads requiring us to ramp up sales. Integrates well with Salesforce and they have a very rigorous onboarding program that must be contributing to that high burn rate. Glad to see a SaaS IPO in Boston stick around- they could well have been acquired years ago.