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Cloudflare S-1

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Re: Cloudflare S-1

#81

Post by the_duke »

zaroth wrote: post #74
koolba wrote: post #62

Here's the meat and potatoes: > We have experienced significant growth, with our revenue increasing from $84.8 million in 2016 to $134.9 million in 2017 and to $192.7 million in 2018, increases of 59% and 43%, respectively. As we continue to invest in our business, we have incurred net losses of $17.3 million, $10.7 million, and $87.2 million for 2016, 2017, and 2018, respectively. For the six months ended June 30, 2…

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)

Re: Cloudflare S-1

#82

Post by rconti »

JohnAtCC wrote: post #37
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…

How so? If the service is WORTH paying for, then it SHOULD be paid for. The world of service, if proven magnetizable, should always be monetized. #FreeMarkets

The salami I try at Costco, as a free sample, is worth paying for. It is food, and it has value.

However, they give me a small sample as an inducement to buy; presumably to increase sales beyond a baseline, in quantities and at prices sufficient to cover the cost of not only the free food they give away, but the labor to do so.

Cloudflare can provide a free product that's WORTH paying for, if their paid product is so much better, and its sales increased by so much, that the free giveaway can be considered a marketing cost that pays for itself.

Re: Cloudflare S-1

#83

Post by rvz »

> 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 milliseconds). We intend to continue expanding our network to better serve our customers globally and enable new types of applications, while relentlessly driving down our unit costs.

This right here is a real tech IPO that has a strong portfolio behind it with a viable business model too and with an impact that affects millions of websites. Throughout this year it is just loss-making companies floating everywhere on the markets here and have boarded the hype-train into the red.

I hope CloudFlare with these numbers here don't board the wrong train here.

Re: Cloudflare S-1

#84

Post by whatshisface »

JohnAtCC wrote: post #37
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…

How so? If the service is WORTH paying for, then it SHOULD be paid for. The world of service, if proven magnetizable, should always be monetized. #FreeMarkets

Markets don't equilibrate at the value to the customer any more than they equilibrate at the cost of production. They compromise between the two.

Re: Cloudflare S-1

#85

Post by cosmie »

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…

This. I've mentioned the first aspect of that in the past here[1][2]. The interconnect benefit never occurred to me, though. That's a neat aspect!

Which just continues to reinforce what I said at the end of [2], about their business model instilling confidence in leveraging them at a free-tier level.

[1] https://news.ycombinator.com/item?id=19127523#19130562

[2] https://news.ycombinator.com/item?id=19127523#19131411

Re: Cloudflare S-1

#86

Post by TheRealSteel »

GordonS wrote: post #36
matthewowen wrote: post #25

Earlier quoted context omitted.

why would the public have a chance to see the financial status of a privately held company? alternatively, would you like to share your financial status with the rest of us?

Interestingly, in Norway citizens' tax forms are public, so you can see what anyone's salary etc is

Not surprising that this is the case in Sweden and Norway, but not in the US, Australia, etc. Aside from the fact that obviously billionaires and corporations don't want the public seeing how they avoid tax, sometimes I suspect that the culture of keeping our salaries secret was deliberately created by the 1% to keep wages low.

Re: Cloudflare S-1

#88

Post by jmtulloss »

antcas wrote: post #64
buildzr wrote: post #39

Earlier quoted context omitted.

I'm sure it's just in my head, but it feels like the first tech IPO in several years where there actually seems to be a viable business model.

Zoom and Twilio as well.

Also fastly, which has the same business model

Re: Cloudflare S-1

#89

Post by ec109685 »

thinkloop wrote: post #75
mikeyouse wrote: post #60

Earlier quoted context omitted.

Zoom stands out in this category too. Random blog on Medium, but the points all stand: https://medium.com/@alexfclayton/zoom-ipo-s-1-breakdown-1192... Growing >100% YoY, profitable, generating cashflow, NPS above 70, just an all around solid business.

Zoom has very little defensible tech, it's more about packaging/marketing. Cloudflare is very difficult to duplicate.

Zoom has network effects. If a company has deployed zoom in their conference rooms, talking to non-zoom shops stinks.

Re: Cloudflare S-1

#90

Post by gamblor956 »

fastbeef wrote: post #48
matthewowen wrote: post #25

Earlier quoted context omitted.

why would the public have a chance to see the financial status of a privately held company? alternatively, would you like to share your financial status with the rest of us?

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?
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