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Cloudflare S-1

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Re: Cloudflare S-1

#131

Post by craftyguy »

louis-paul wrote: post #56
the_duke wrote: post #14

The free tier of Cloudflare has been really amazing for small to medium websites. It gives you a basically unlimited CDN, SSL, HTTP/2, DDos protection and fast DNS servers with almost 0 effort... for free ... Thus increasing the stability and speed of many web properties that otherwise wouldn't pay for it. I'm afraid this could easily change once the company is public and is under the pressures that come along with i…

They list it as a key element of their business model: > Free customer base—Free customers are an important part of our business. These customers sign up for our service through our self-serve portal and are typically individual developers, early stage startups, hobbyists, and other users. Our free customers create scale, serve as efficient brand marketing, and help us attract developers, customers, and potential emp…

> They list it as a key element of their business model:

And we all know public companies never change 'key elements' of their business models... (hint: they do)

Re: Cloudflare S-1

#132

Post by judge2020 »

the_duke wrote: post #81
zaroth wrote: post #74

Earlier quoted context omitted.

What the heck happened to their OpEx in 2018?! They went from growing at 60% YoY in 2017 with an 8% Operating Loss, to growing 43% YoY with an Operating Loss of 44%. To put it another way, in 2018 they grew their revenue 40% (+$58m) and grew expenses 100% (+$115m). I mean, apparently they raised a huge round and felt the need to increase spending massively. And then saw slowing growth as a response? Was there a massi…

My guess: new development-intensive products like the 1.1.1 DNS, Wireguard, WAF etc plus general scaling and growth on one side, and increased competition from established cloud services on the other. After all, if you are already on eg AWS, just using Cloudfront is temptingly easy. (even if bad from a redundancy perspective)

AWS also offers a managed WAF - https://aws.amazon.com/waf/

Re: Cloudflare S-1

#133

Post by nacs »

jrockway wrote: post #106

Am I reading this right when it looks likes they spend twice as much money on sales as engineering? There was also a very strange spike in stock compensation in 2018, $27,000,000 compared to $2,755,000 in the previous year and $1,849,000 in the next. What happened there?

Stock compensation spiking a year before their IPO doesn't seem unusual. It's likely an employee incentive.

Re: Cloudflare S-1

#134

Post by judge2020 »

jakarta wrote: post #119

why would the cohort expansion rate be so much lower than Fastly's? https://www.sec.gov/Archives/edgar/data/1477333/000119312519... ^ cloudflare data on p. 80 shows a rate of 10-15% expansion https://www.sec.gov/Archives/edgar/data/1517413/000119312519... ^fastly data on p. 66 shows cohort expansions that are much faster

This is a shot in the dark, but maybe the fact that there's a free tier is a deterrent for (old-school) established enterprises?

Re: Cloudflare S-1

#135

Post by judge2020 »

craze3 wrote: post #24

This is perfect timing considering they made headlines all of last week for banning that one site from their platform. But Google Trends seems to reveal that the banning incident was only 1/4 of the search volume they got for their big service outage on July 2nd: https://trends.google.com/trends/explore?date=today%203-m&ge... I wonder how the IPO news will compare in terms of global search volume

This is noted in their risk factors:

> Following the events in Charlottesville, Virginia, we terminated the account of The Daily Stormer. Similarly, following the events in El Paso, Texas, we terminated the account of 8chan. We received significant adverse feedback for these decisions from those concerned about our ability to pass judgment on our customers and the users of our platform, or to censor them by limiting their access to our products, and we are aware of potential customers who decided not to subscribe to our products because of this.

Within the next week we'll see the trends that represent how much nouse their IPO made (IPO news is generally slower moving): https://trends.google.com/trends/explore?date=today%201-m&ge...

Side note: you can see that an outage makes about 4x more noise than PR about DDOS protecting a website like 8chan: https://trends.google.com/trends/explore?date=2019-06-25%202...

Re: Cloudflare S-1

#136

Post by whatshisface »

erikig wrote: post #129

Both CloudFlare and Zoom are pretty great products and as much as I applaud their team's IPOs, I'm worried that the vagaries of being a public company will result in the GOOG syndrome. That's where a company with a great product is forced to expand every quarter to the point that it becomes a frankenstein-ish hulking version of itself.

Why not just pay a dividend? That's what stocks are supposed to be, shares of ownership in legitimately valuable enterprises with return on investment.

Re: Cloudflare S-1

#137

Post by toupeira »

gamblor956 wrote: post #90
fastbeef wrote: post #48

Earlier quoted context omitted.

I don’t want to post my own company since it can be traced to me IRL, but yeah, all tax returns are public in Sweden, personal and companies alike. Here is Spotify’s financials from its inception to today: https://www.allabolag.se/5567037485/spotify-ab You can find the same data for all companies.

Spotify is publicly traded. Do you have an example for a privately owned company?

Buffer is one example: https://buffer.baremetrics.com/

Re: Cloudflare S-1

#138

Post by paggle »

rvz wrote: post #83

> Today, our network spans 193 cities in over 90 countries and interconnects with over 8,000 networks globally, including major ISPs, public cloud providers, SaaS services, and enterprises. We estimate that we operate within 100 milliseconds of 98% of the Internet-connected population in the developed world, and 93% of the Internet-connected population globally (for context, the blink of an eye is 300-400 millisecond…

The blink of an eye is not 300ms.

Re: Cloudflare S-1

#139

Post by spullara »

paggle wrote: post #138
rvz wrote: post #83

> Today, our network spans 193 cities in over 90 countries and interconnects with over 8,000 networks globally, including major ISPs, public cloud providers, SaaS services, and enterprises. We estimate that we operate within 100 milliseconds of 98% of the Internet-connected population in the developed world, and 93% of the Internet-connected population globally (for context, the blink of an eye is 300-400 millisecond…

The blink of an eye is not 300ms.

https://bionumbers.hms.harvard.edu/bionumber.aspx?s=y&id=100...

100-400ms. Close enough.

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