Snowflake’s CEO shares how he get got a $1.5 billion valuation from Sequoia Capital just four years out of stealth mode
Snowflake only left stealth mode in 2014, but you wouldn’t know it from the amount of money the company has raised.
The San Mateo-based cloud-computing startup just hit unicorn status with $263.5 million in funding led by ICONIQ Capital, Altimeter Capital, and newcomer Sequoia Capital. That brings its total growth funding up to $480 million, with a valuation of $1.5 billion.
The rapidly growing company, which sells data warehouses for the cloud, now has around 1,000 customers including Adobe, Capital One, Sony Pictures, and Instacart.
These enterprises use Snowflake to bridge the gap between old school data storage systems that have been used for decades by large companies, and the more efficient forms of storage that are enabled by cloud computing. Snowflake essentially eases the transition to the cloud for companies that work with ginormous loads of data.
Now, with a hot technology and Microsoft veteran Bob Muglia as CEO, Snowflake is just a few years out from going public. Business Insider checked in with Muglia to find out more about his plans for the company and what it takes to raise a mega round and a unicorn valuation.
This interview has been edited and condensed for clarity.
Becky Peterson: Your team just raised $263.5 million. What do you plan to use it for?
Bob Muglia: We’re going to use the money to expand our sales and services organization globally to bring the product to customers all around the world, and we’re going to continue to invest in the team that [co-founder and chief technology officer Benoit Dageville] built.
We feel that we have a really substantive product and head start compared to anyone else. I think we’re pulling further ahead and we’re going to continue to invest.
Peterson: Are you already international?
Muglia: Yes, we have about 40 people in Europe right now, and five people in Australia. Both of those are new within the last year.
A year ago we were just bringing on board our first folks in Europe. And now we have over 40 people there. In fall we started hiring in Australia. We’ll look toward Asia in the coming 12 to 18 months. Probably expanding into the Singapore region and Japan and Korea. Maybe someday China, but that’s further out.
Muglia: China‘s a tough market for any American company. If you look at where you want to expand, China is toward the tail end.
What we’ll probably do is go where our customers want us to go. I know we have some large, multi-national companies that do a fair amount of business in China. And they have to keep data in China. So that’s probably what will push us to that market.
Peterson: At $263.5 million, this funding round is large by any measure. From a business perspective, what is the advantage of having such a large funding round?
Muglia: Companies are moving actively and aggressively to the cloud. This funding allows us to take the technology and this service to market to all of our customers around the world and give them support the way they need it. We’ll be investing in resources in sales and service to do that, and we’ll be building our R&D team around it.
Why do we need so much money? It’s a global world, there are a lot of customers out there.
Frankly, we’re competing against some of the largest companies on the planet. Companies like Amazon, Microsoft, Google, Oracle. And although $263 million is a lot of money, it’s a lot less money than they have.
