GitLab Secondary Sale: Company Valued at $6 Billion

GitLab has verified with TechCrunch its involvement in a $195 million secondary sale, establishing the company’s value at $6 billion. CNBC initially reported on this development earlier today.

This substantial valuation follows the company’s Series E funding round in 2019, where it secured $268 million at a $2.75 billion valuation. This represents a growth of $3.25 billion in less than 18 months. GitLab’s co-founder and Chief Executive Officer, Sid Sijbrandij, attributes this increase to the ongoing enhancements and additions to the platform’s capabilities.

“We are confident that the rise in valuation over the past year reflects the advancements of our comprehensive DevOps platform and its increasing share within the expanding software development market, which is valued in the billions of dollars,” he explained to TechCrunch.

Although the startup has accumulated over $434 million in funding, this particular round focused on the purchase of employee stock options, providing GitLab’s team members with an opportunity to realize gains from their equity before a potential public offering. According to CNBC, the firms participating in this stock purchase included Alta Park, HMI Capital, OMERS Growth Equity, TCV, and Verition.

An initial public offering (IPO) appears to be the next logical progression for the company, a path GitLab has consistently considered. The company previously even specified November 18, 2020, as a prospective IPO date on its internal company wiki. While that specific timeline wasn’t met, Sijbrandij maintains that going public remains a future objective. He indicated that the company has sufficient financial resources from its latest funding round and will pursue an IPO when the conditions are optimal.

“We continue to view becoming a public company as essential to achieving our core mission. As a publicly traded entity, GitLab would experience increased brand recognition, improved access to capital, liquidity for shareholders, greater operational independence, and enhanced transparency,” he stated.

He further noted, “However, we aim to maximize the benefits by choosing a strategic moment. Our most recent funding in 2019 has resulted in a robust balance sheet. This financial strength and our business model allow us to select a timeframe that best supports our long-term objectives.”

GitLab distinguishes itself by openly publishing its IPO goals, overall company philosophy, and Objectives and Key Results (OKRs) for public access. Sijbrandij shared with Alex Wilhelm of TechCrunch during a TechCrunch Disrupt panel in September that this level of transparency is a key factor in attracting and retaining talented employees. Contributing to this is the company’s fully remote work structure, which was in place even before the COVID-19 pandemic.

“We initially implemented this level of transparency to connect with the broader GitLab community, but it has proven to be exceptionally valuable in attracting top-tier talent,” Sijbrandij told Wilhelm in September.

Founded in 2014, the company provides a DevOps platform designed to streamline the application development lifecycle.

Update: The original headline of this story has been changed from ‘GitLab raises $195M in secondary funding on $6 billion valuation.’