Software IPOs in 2024: Market Conditions, Subscale Company Viability, and the OneStream Test
The article analyzes the 2024 software IPO landscape, noting a dramatic decline from the 2021 boom despite strong overall equity markets. It argues that subscale cloud companies (<$500M revenue) face significant valuation discounts due to unproven revenue growth endurance relative to mature peers, using OneStream's $500M ARR IPO as a market test case.
Metrics in this report
25percent
5-year
Bessemer Cloud Index (WCLD) tracking public cloud companies
11percent
OneStream IPO candidate, described as needing 'meaningful progress towards even stronger long-term profit margins'
32percent
benchmark
CrowdStrike mature public company with $3.6B revenue
98percent
best-in-class
OneStream IPO candidate metrics
9billion USD
minimum
AppFolio, smallest by market cap among top 10 revenue multiple public cloud companies
70billion USD
average
Top 10 highest revenue multiple public cloud companies
118percent
best-in-class
OneStream IPO candidate metrics
34percent YoY
target
OneStream at $500M ARR, described as 'good but should be looked at in context of revenue size'
29percent
benchmark
CrowdStrike mature public company comparison for OneStream
45score
OneStream IPO candidate (34% growth + 11% FCF margin)
35percent
Nvidia's contribution to S&P 500 gains in 2024 year-to-date
157percent
5-year
QQQ ETF (broad technology market) performance