Thanks to Consumerization, It's IPO Season in Analytics
At some indeterminate time, very possibly this year, business intelligence (BI) favorite Tableau Software will file for its initial public offering. It continued laying the groundwork for the move on Thursday, Feb. 23, by announcing accounting and finance specialist Brooke Seawell as the company’s newest board member. When Tableau does file, it will be in good company along with others that were smart enough to ride the twin waves of consumerization and big data.
QlikView (QLIK)—Tableau’s biggest competitor in the next-generation business intelligence space—went public in July 2010 and is currently trading at about $30 a share after starting at around $15. In 2011, it brought in $320.6 million in revenue from more than 24,000 customers, almost a third of that in the fourth quarter alone. In January, Splunk, a software company that makes it easy to parse through, analyze, and visualize server logs and machine-generated data, filed for its IPO and hopes to raise $125 million. Splunk closed its fiscal year 2011 with $66.2 million in revenue, nearly doubling annual sales over each of the past two years.
Tableau, for its part, earned almost $72 million in revenue in 2011, co-founder and Chief Executive Officer Christian Chabot told me during a call on Thursday, almost double what it earned in 2010. The company nearly doubled its head count in 2011 to about 350 employees, and Chabot said it is looking to add another 300 or so employees in 2012. “It has always been Tableau’s intent to build a big and international and publicly held company,” he said, and the revenue, employee, and management growth are all part of that plan. It has more than 50,000 users,
These companies are growing like gangbusters and surviving the siren song of M&A because they make products that make it easy to analyze and visualize data. The advent of big data highlighted the importance of both of those tasks, but it also introduced the world to data scientists—who are in high demand and low supply—as the way to do them. However, Tableau, QlikView, and Splunk all connect to big data platforms such as Hadoop and Teradata and vastly simplify the process of performing certain analyses and creating compelling charts.
More important, though, these companies also cater to everyday users who don’t have any need for big data—or even skills in legacy BI tools—but who understand the importance of analyzing the data they have. Tableau even has a free version, Tableau Public (requires registration), that is hosted in the cloud and caters to bloggers and other knowledge workers who understand the importance of data analysis but don’t have the budget to pay $999 for Tableau’s entry-level desktop software.
QlikView founder and CEO Lars Bjork told me during a November call that just as Google (GOOG) and Apple (AAPL) have made consumers the masters of their personal technology, his company as well wants to make business users the masters of their own tools.
QlikView Chief Technology Officer Anthony Deighton expanded on this, noting that end users in business are often pushed data from analysts rather than being able to derive their own insights. “We want to be the end of the end user,” he said.
Splunk is already letting customers click and search their way through the data in its system similar to how they surf the Web, but founder and CTO Erik Swan—who I will be interviewing onstage at our Structure: Data conference next month—told me in June that the company is hard at work on new capabilities that will let developers actually write MapReduce-like applications to access Splunk data using popular languages like Ruby and Java.
Tableau’s Chabot explained his vision to me during the company’s user conference in October. Tableau has invested heavily in a product that understands users’ data and can guide them to the best ways to analyze and visualize it—all while cloaking analytical functions behind a drag-and-drop interface. Right down to the psychological rules and Edward Tufte presentation principles built into the product, he said, it’s all about creating the most intuitive and yet amazing product possible, an iPhone in a world of legacy brick phones.
“In any field of human endeavor … there are a hundred to a thousand more people who understand the data of that field more than they understand reporting and analytics,” said Chabot. When they are all using your product, it turns out, that’s great for business.
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