Harness isn’t founder Jyoti Bansal’s first startup. It sold AppDynamics to Cisco for $3.7 billion in 2017, the week it was supposed to go public. His latest project has raised $425 million.per crunch base.
on Tuesday, Usage Announced $150 million in debt financing, essentially a line of credit that the company can draw on as needed. This could be the last private financing step before an eventual IPO. It is worth noting that the company took another round of debt financing of $55 million in 2022.
Harness has created a soup-to-nuts toolset for software development teams that includes, among other things, a CI/CD pipeline, code repository, developer portal and infrastructure as code support. The company indicated it will use the financing to build or purchase other pieces for the toolset.
Bansal says he was looking at different ways to raise money, and saw debt financing as a way for healthy public companies to access additional capital. “We’re looking at what’s the best way to raise capital, and if you look at any public company, most public companies have access to debt — and that’s what they call a healthy business. but will be collecting,” Bansal told TechCrunch.
He also says it’s an efficient way to raise capital because they don’t have to give up any equity. This can be a good final addition before the next logical step. “We think we can carry that debt to the IPO. We don’t need to raise any more equity. Who knows, we can liquidate it, but we don’t need to, and we’re out of here.” can go for an IPO without any additional investment,” he said.
The business seems set up well for this next big step: it surpassed $100 million in ARR last year, which is an indication that the company is sustainable and around for the long haul. . Bansal says the revenue is moving beyond that milestone.
The company recently hired a chief revenue officer, and replaced him with a chief financial officer — all signs that the company is considering an IPO.
Bansal has set three criteria for success: Harness wants substantial revenue, growing faster than the $100 million it hit last year; It wants to be effective because Wall Street is now demanding it. And it wants to develop higher. If Bansal continues to pursue the business with these three goals in mind, he thinks it will eventually lead to going public.
“An IPO is just a milestone in functioning as a company. It’s not like an IPO is an exit. It’s the first step to becoming a public company,” he said. There are, and we’re ready, we just want to be in the right financial position, that our business is strong, and that we have all the right elements for that.”
And for Bansal, who sold his previous startup before it went public, heading a public company is something he aspires to. “That’s the next challenge, which I’m excited about,” he said.
The $150 million credit line comes from Silicon Valley Bank and Hercules Capital, Inc.
Credit : techcrunch.com