New York stock exchange. Picture: REUTERS
New York stock exchange. Picture: REUTERS

New York/Seattle — All eyes are on cloud-data software maker Snowflake’s trading debut after it raised $3.36bn in the year’s biggest US initial public offering (IPO) for an operating company and the largest in software ever.

The California-based company is set to list on the New York Stock Exchange on Wednesday under the symbol SNOW. It sold 28-million shares on Tuesday for $120 a piece, above an already elevated range, according to a statement. The shares were marketed at $100 to $110 a piece, boosted from $75 to $85 earlier.

The listing ranks as the biggest US IPO this year, excluding the $4bn offering by the special purpose acquisition company backed by billionaire Bill Ackman.

Snowflake is valued in the IPO at more than $33bn based on the outstanding shares listed in its prospectus. That compares with a valuation of $12.4bn in a private funding round announced in February.

It’s a busy week for IPOs as technology and other companies rush to get in the door ahead of the November 3 US presidential election. Sumo Logic and Unity Software are among 15 companies going public this week, seeking to raise a combined $8.3bn, according to data compiled by Bloomberg. JFrog, which priced its $509m IPO above target, is also expected to begin trading on Wednesday.

Snowflake lured Warren Buffett for a rare investment in an IPO. Berkshire Hathaway and Salesforce Ventures, an arm of Salesforce.com, have each committed to buy $250m worth of the company’s class A common stock in a private placement. Berkshire has also agreed to buy 4-million shares in a secondary transaction, according to Snowflake’s filing.

Snowflake, founded in 2012, is a rare challenger to Amazon as a provider of data warehouse technology, which compiles information from different systems so clients can analyse it together in the same place.

In the fiscal year ending on January 31, Snowflake’s revenue soared 174% to $264.7m compared with the previous fiscal year, the company reported. In the sixth months ending on July 31, sales were $242m, a 133% year-one-year increase.

The Snowflake offering is being led by Goldman Sachs Group and Morgan Stanley.

Bloomberg

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