HashiCorp, a cloud-developer-tool startup, went public on Thursday, achieving a valuation of over $15 billion by the end of its first trading day.
After HashiCorp hit the market, its shares rose by 6.5%. It ended its first day with shares at $85.19 and started Monday at $86.
It's a notable time for companies with products that bridge development and operations processes, known as DevOps, as investors indicate they finally see the value of developer tools. HashiCorp's competitors have also gone public in recent years, including GitLab's $15 billion initial public offering in October and JFrog's $6 billion IPO last year.
Founded in 2012, HashiCorp builds developer and security tools for engineers to use across multiple clouds based on DevOps technology that its cofounder Mitchell Hashimoto wrote in college. Backed by firms like Redpoint Ventures and GGV Capital, HashiCorp raised nearly $350 million from VCs in the years before it went public.
But when HashiCorp started, many people didn't know what DevOps was, said Armon Dadgar, HashiCorp's cofounder and chief technology officer. HashiCorp pushed ahead, building tools and processes to help customers launch cloud-based applications.
"It used to be if you asked what DevOps is, you got 12 answers," Dadgar told Insider. "For us, we always had a really clear idea of it."
DevOps tools have become important as more companies have moved to the cloud, Dadgar said. Because many of HashiCorp's tools were open source, developers could download them for free and use them on any cloud, allowing projects to spread much faster. Developers — and eventually their companies — quickly realized the value in faster development.
HashiCorp's success, however, hasn't been without challenge. Leading up to the IPO, HashiCorp went through a major leadership change when Hashimoto stepped down as CTO to become an individual contributor leading engineering projects. But it went smoothly, as Hashimoto had already been a major contributor to those projects, even as CTO, Dadgar said.
Post-IPO, HashiCorp will focus on helping its customers — which include many of the world's biggest enterprises — understand how to use open-source products and solve common problems like security, CEO Dave McJannet said. The company also plans to expand its work with major cloud vendors so that customer applications run smoothly across their IT environments.
"As we think about where we sit in the market, we see this as the end of chapter one and beginning of chapter two," Dadgar said.
HashiCorp's so-called chapter two includes planning for growth. It has about 2,000 employees now after hiring close to 1,000 employees since the beginning of the pandemic. As it looks to continue hiring, keeping a positive company culture — including values like pragmatism, humility, and integrity — matters the most, Dadgar said.
"Ultimately, the products will evolve because the problems evolve. In some sense, those come and go," Dadgar said. "It's the foundation of how we build software and how we treat our partners, how we treat our employees. That's the piece that's stickier."
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