On December 6, 2018, Looker announced that it closed a $103 million E round led by Premji Invest, a private equity firm owned by Wipro chairman Azim Premji. This round also includes new funds from Cross Creek Advisors, a venture capital firm focused on late-stage investments with current investments including tech darlings such as Anaplan, Datastax, Docker, DocuSign, Pluralsight, and Sumo Logic. This round also included participation from current investors from prior rounds (such as Looker’s Series D covered by Amalgam Insights).
This round is expected to be a final round before a potential Initial Public Offering. Of course, in recent times, plans for IPO from hot companies have been interrupted at the last moment, such as with Workday’s $1.55 billion acquisition of Adaptive Insights (see Amalgam Insights’ coverage for more information) and SAP’s $8 billion acquisition of Qualtrics. A Looker IPO may not be guaranteed, but Amalgam Insights would expect that the valuation of Looker is likely not going to be affected whether the company ends up going public or being acquired for strategic reasons.
Why is Looker worth $1.6 billion?
With this funding, Looker crosses into “unicorn” territory with a valuation of approximately $1.6 billion. This valuation is based on Looker’s run-rate of over $100 million in annual revenue supported by an employee base that is approaching 600, year-over-year growth exceeding 70%, and expansion into Tokyo to support the Asia-Pacific region.
Amalgam Insights believes that this valuation reflects several key trends and intelligent strategic decisions made by Looker in supporting enterprise-grade business intelligence and data supply chain needs.
First, Looker was developed to support a variety of data preparation, cataloging, governance, querying, and presentation capabilities at scale across a wide variety of data sources and formats. This approach reflects Looker’s purpose of being a data platform built for a new generation of data analysts based on the volume and variety of challenges that drive current analytic challenges.
Taking a step back, I remember when I first ran into Looker on the trade show circuit. I was looking at a variety of BI solutions in 2013, including the likes of Tableau, Qlik, and Microstrategy, when I ran into a small booth manned by a guy named Keenan Rice, who currently serves as Looker’s VP of Strategic Alliances. As a jaded analyst, I asked how his solution was different from the 30+ other solutions that were being shown on that show floor. At the time, everyone was bragging about their pixel-perfect visualizations, report building capabilities, and basic data presentation that were interesting to see, but rarely provided significant value, competitive differentiation, or Return on Investment.
However, Keenan’s pitch differed substantially. Although Looker also provided visualizations for large data tables, Keenan started by talking about data analyst challenges in preparing data for self-service analytics, using Looker’s SQL-based LookML as a modelling layer to access a variety of data, bringing new data into existing data and analytic workflows, and delivering it all as Software-as-a-Service. As a former data analyst, this was all music to my ears, but I wondered if Looker would be able to stand out as a solution against all of the dashboarding solutions, report builders, and the massive marketing budgets of incumbent BI vendors. Looker was just starting as a company and had just announced its Series A, so it faced significant odds in standing out based on the $10 million to $40 million range of Series A or Series B funding that a company like Looker would typically get at this point.
But it has been a pleasure both to seek Looker grow over the years and to lead a new generation of solutions focused on simplifying data supply chains and pipelines. It ends up that Looker was just early enough to avoid having comparable competition while solving a market need that businesses understood, especially those companies seeking a new generation of BI-based capabilities and wanting to develop a more data-driven organization. So, that’s a long way of saying that Looker took a big and laborious bet against the grain six years ago and has been rewarded for having a combination of good product and good timing.
But this isn’t the only reason that Looker has been successful.
As Looker has achieved market fit and success, the solution has evolved from a data workflow solution into an emerging application development solution that allows analysts and developers to work collaboratively in building secure and embeddable data models. By truly building Looker as a platform rather than simply calling it a platform as an aspirational goal based on a set of APIs, Amalgam Insights expects that Looker will become increasingly valuable for data analysts and the “citizen” developers who seek to increase appropriate access to enterprise data and analytic outputs.
And Looker has now taken an important step forward in providing department-specific apps in the most recent Looker 6 launch. Starting with digital marketing and web analytics, Looker is now taking advantage of its analytics capabilities to provide out-of-the-box support to help enterprises with key challenges rather than forcing clients to build foundational analytics that have been built over and over. Both these apps and Looker’s development focus build on top of Looker’s prior focus on Looker Blocks first launched in 2015, which were a collection of SQL, visualizations, and pre-built analytic models designed to accelerate analytic projects.
So, what is next for Looker? IPO? Global domination?
All kidding aside, with expansion into AsiaPac to accompany Looker’s existing European offices in London and Dublin and Looker’s current 70% growth rate, it is possible that Looker could increase net-new revenues in 2019 faster than BI stalwarts such as Information Builders and Qlik. From a financial perspective, Amalgam Insights notes that Looker’s growth mirrors that of Alteryx, which has roughly quadrupled its stock price since its March 2017 IPO which was based on Alteryx’ 2016 revenue of roughly $86 million with 59% year-over-year growth.
Looker has stated that it believes that this Series E round should be its last funding round before IPO and, given recent market valuations for successful software companies, there should be no reason to expect otherwise from Looker. Looker’s progress both as a software development platform as well as a platform of pre-built applications and services bodes well for Looker as it continues to evolve as an enterprise platform focused on expanding access to data insights.
Finally, Amalgam Insights believes that Looker’s success will lead to continued success with other data and analytics companies focusing on rapid data modelling, data mapping, and analysis of multiple data sources. Looker’s agile BI approach that avoids the challenges of traditional BI and ETL solutions in supporting multiple data sources has become a new standard for accelerating the value of data. This both means that traditional BI companies will need to accelerate their own data pipeline efforts or to partner with other vendors and that Looker will start to be targeted in the same way that the likes of Tableau, Qlik, and Microstrategy have in the past. The price of success is increased competition and innovation, which is good news for the BI, data, and analytics markets and should provide Looker with enough challenges to avoid resting on its laurels.
On December 5th, 2018, Tangoe announced the acquisition of MOBI, a leading managed mobility services organization based in Indianapolis, Indiana in the United States. With this acquisition, Tangoe increases its IT spend under management to over $40 billion, increasing its lead over other spend management vendors with multiple billions of dollars of enterprise technology under management including Flexera, Snow Software, Microsoft Azure Cost Management, CloudHealth by VMware, Calero, MDSL, Cass Information Systems, and Sakon.
