Newly Public Splunk Capitalizes on Big Data and Cloud Security Trends

IDC estimates that the market for Big Data technology and services will grow from $3.2 billion in 2010 to $16.9 billion in 2015, translating to a 40% annual growth rate. The volume of digital information created and replicated from 2011 through 2015 is projected to grow 45% annually from 1.8 trillion gigabytes to 7.9 trillion gigabytes. Recently listed Splunk focuses on managing this data. Looking at the market’s reaction to their stock listing, it may be a company to reckon with.

Splunk’s Financials
San Francisco–based Splunk was founded in 2004 by Erik Swan, Rob Das, and Michael Baumto to deliver services to help organizations manage and analyze machine data generated by websites, applications, servers, networks, and mobile devices. Splunk’s customers get operational insights into their end customers’ buying habits using data available on-premise or in the cloud. Splunk claims to have almost half of the Fortune 100 as customers and boasts of a total consumer base of more than 3,700 enterprises in more than 75 countries. Their customers include Bank of America, Comcast, Salesforce.com and Zynga, which they help by sifting through the data generated on software apps, clickstreams, and other web interactions.

Splunk’s software is available as a free download initially. After the 60-day trial period, organizations can either purchase the software license based on their indexing capacity or continue to use the free product, with fewer features and limited data indexing capacity.

Splunk saw revenues grow from $18.2 million in 2009 to $35 million in 2010. They ended 2011 with revenues of $66.2 million, recording 89% growth for the year. Although the company continues to suffer losses, these are narrowing. In 2009, they reported a net loss of $14.8 million, which fell to $7.5 million in 2010 and to $3.8 million in 2011. Splunk’s fiscal 2012 ended this January, with revenues growing 83% to $121 million.

Before Splunk went public, the company had raised $40 million in venture funding from investors, including August Capital, JK&B Capital, Ignition Partners, and Sevin Rosen Funds. After filing their S-1 in January this year, their stock listed on Nasdaq under the ticker SPLK.

New Security Products to Help Resolve Problems Faster
Splunk has been expanding their product portfolio. Recently they launched their next generation security intelligence solution that integrates their app for enterprise security and their flagship Splunk Enterprise 4.3 for the collection, analysis, and indexing of data. The new app leverages their existing Enterprise software while adding security features that include real-time search and alert tools for monitoring critical assets; the ability to present visual dashboards for security data, simplified analysis of data using drill-down and drill-across tools; the ability to monitor identity; and enhanced incident management wherein users can prioritize, assign, and journal security events for faster resolution.

Splunk priced their IPO at $17 a share to raise $125 million in funding. Their stock is faring well and is trading at $35.80, with a market capitalization of $3.31 billion.