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Data Security Operator Varonis Set for a Sizzling IPO

Varonis helps companies automate a tough process


Varonis, which develops software for data protection, has filed for an IPO. It plans to list on the Nasdaq under the symbol of “VRNS. Lead underwriters include Morgan Stanley (MS), Barclays (BCS), Jefferies and RBC Capital Markets.

And considering strong deals from Splunk (SPLK) and FireEye (FEYE), the Varonis IPO should have little trouble ginning up investor interest.

Soros-Backed Essent Preps for an IPO
Soros-Backed Essent Preps for an IPO

Tech veterans Yaki Faitelson and Ohad Korkus founded Varonis back in 2005, seeing a big opportunity to build a system that would allow companies to monitor access to sensitive data. For the most part, the traditional approach was manually intensive and fairly complex.

With Varonis, a company can map the unstructured data of an enterprise, such as spreedsheets, word processing documents, emails, texts and presentations. Often such content has propriety information that should remain protected. So with Varonis, it’s much easier to identify sensitive information as well as tracking the usage — both authorized and unauthorized.

It’s not an easy problem to solve. Based on a study from IDC, the amount of digital data created and replicated in 2012 exceed 2.8 zettabytles, or trillions of gigabytes. The firm predicts that this will grow an annual compound rate of 39% until 2020. About 90% of this will be unstructured data.

As should be no surprise, Varonis has been ramping at a nice clip. From 2010 to 2012, revenues jumped from $28.9 million to $53.4 million. Meanwhile, losses have been reasonable, coming to $4.8 million last year.

Already, Varonis has over 2,100 customers that span diverse industries like financial services, retail, technology, healthcare, media and energy.

And it also looks like Varonis has only scratched the surface. According to IDC estimates, the addressable market opportunity is a whopping $45 billion.

With that in mind, the upcoming Varonis IPO could definitely be a hot one

Tom Taulli runs the InvestorPlace blog IPO Playbook. He is also the author of High-Profit IPO StrategiesAll About Commodities and All About Short Selling. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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