I have learned about this IPO filing through Google Alerts. Thank you Google. Google
Alerts is a good way to be on top of news and investment ideas. But just make sure that
you don't subscribe to too many alerts then it gets annoying.
1.3,900 customers over 90 countries. 30% of Fortune 1000. Wow, compound 35% growth from 2011 to 2014
2. Gartner Inc estimates that by 2020, 60% of enterprise information security budgets will be allocated for rapid detection and response approaches. Data Corporation estimates that the overall market for security data and analytic is $12.6 bn in 2015.
3. Emerging growth company. Lot of R&D expense due to intense competition.'
4. Wow, such a long risk section but nothing so out of the ordinary.
5. High renewal rate (85%). Also, security services tend to be sticky. Expanding gross margins :D
6. No red flag in the notes.
**Assessment
Pros: High growth, expanding margins, good industry :D Also, helps the world. Cyber security will only become more important. Potential acquisition target by competition or just large tech firm (e.g., Microsoft).
Cons: No high level manager specializing in technology (No CTO). Usually, you want some tech personnel at the top but I guess the executives have tech experiences.
I am not totally sure about the security product but I love the growing revenue and expanding gross margin and the increasing R&D/ marketing. These measures are likely to help Rapid7 grow more quickly.
I need to do more due diligence but it may be a good buy.
From Snapshot Serengeti
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