A Rubrik IPO reportedly could come in 2024 if the IPO market improves by then.

That’s according to Reuters. The publication says Rubrik, the zero trust data security provider backed by Microsoft, has hired banks to help with the initial public offering (IPO) filing. It’s working with Goldman Sachs, Barclays and Citigroup for its IPO.

Reuters cited people familiar with the matter who requested anonymity. Rubrik is not commenting on the news.

A Rubrik IPO might raise more than $750 million, three of the sources told Reuters. However, that may change based on market conditions as it’s still early on with preparations.

Rubrik currently generates annual recurring revenue of about $600 million, one of the sources said. It was valued at $4 billion in a 2021 fundraising round.

Rubrik Has Decent Shot at Successful IPO

Rik Turner, senior principal analyst with Omdia, said data resilience, observability and remediation, all of which Rubrik provides, are “very much on the crest of a wave at the moment.” Omdia shares a parent company with Channel Futures (Informa).

“Traditional backup and restore vendors are all repositioning as ransomware protection vendors, and technologies such as data security posture management (DSPM) are promising the discovery, assessment of risk and remediation, at least for cloud-based data stores,” he said. “So on one level, if any vendor has a shot at a good IPO, it could be Rubrik. On the other, the market is both depressed and difficult at the moment, hence the postponements of multiple IPOs and [accompanying] layoffs by frustrated would-be flotation candidates such as Cybereason and Lacework.”

An IPO is risky business, Turner said. If it flops, it consigns Rubrik, “if not to the dustbin of history, then at least to the little league or whatever you folks call it.”

If successful, it establishes Rubrik as a leading player in a hot market segment that is much in demand, and puts it well ahead of all the startups that are still privately held,  he said.

Pros, Cons to Going Public

“Sure, you can raise a decent sum of money at flotation, but then you have the scrutiny of all those Wall Street analysts every quarter, and you definitely don’t want all that bad press if you issue a poor set of results,” Turner said. “Remember how this contributed to the decline of FireEye before it got acquired by Symphony Technology Group.”

According to a recent Ernst & Young report, in the first quarter, both the number of IPOs in the United States and the amount of proceeds raised were generally in line with the first quarter of 2022. However, they were well below levels seen in comparable periods over the last decade.

For the U.S. IPO market to rebound, the first wave of IPOs will need to come to market at reasonable valuations, price well compared to their marketing ranges and trade well in the aftermarket, it said.

In April, Rubrik and Zscaler announced they are partnering to enable enhanced ransomware protection. The companies integrated Rubrik’s Sensitive Data Monitoring & Management SaaS-based data classification, discovering and reporting solution with the data loss prevention (DLP) technology in Zscaler’s data protection offering, which will be available to the two companies’ mutual customers.