CrowdStrike's $ 100 million alfabet stake on CrowdStrike's security software vendor is overshadowed by its investments in higher-ranking companies such as Uber, Airbnb, and Stripe. But it may be more profitable than any of them.
With CrowdStrike rising 71% on its stock market debut on Wednesday, AlphaBet's investment group CapitalG owns a share of nearly $ 1.2 billion, which represents about 10-fold returns in just under four years (including purchases of shares from 2015 to 2018).
Add this to Alphabet's investments in competitors Uber and Lyft, and company shares in the IPO class for 201
of pp. According to its title, CapitalG has bet on about three dozen companies, according to its website, with an emphasis on financial technology, markets, technology infrastructure and cybersecurity. CrowdStrike, which develops cloud software to provide corporate data, marks Alphabet's first major victory in security. He also had a small stake in Zscaler, which became public last year, and is an investor in the cloud seller before IPO Cloudflare.
"Google Capital, like us, believes the only way to solve current and future security challenges will be provoked by the cloud," CrowdStrike Executive Director George Kurtz told a blog during the 2015 investment [InitslatestquarterlyreportAlphabetsaiditstotalportfolioofnon-marketableequitysecurities-whichincludesinvestmentsmadebytheGVGroupearlystage-isworth$1295billionincludingunrealizedearningswouldby$46billions
From a purely monetary point of view, Uber remains the company's most profitable stake. The investment of $ 258 million (together with the Alphabet shares, which were awarded $ 245 million in settlement with Uber) is currently worth $ 3 billion. But the CrowdStrike's rate of return is similar and, depending on how the shares are traded here, may be even higher. Like other people from CrowdStrike, CapitalG is forbidden to sell shares for 180 days.
Uber trades below the IPO price last month and burns money when it tries to repel Lyft. Capital investment of $ 500 million in Lyft since 2017 is now worth 749 million dollars – a relatively small profit. CrowdStrike also loses money, but much less. In the quarter that ended in January, its net loss shrank to $ 31.3 million from $ 37.5 million, while earnings rose 44 percent to $ 80.5 million. Losses of Uber and Lyft are increasing.
CapitalG can also make a good profit from Airbnb, although it will be hard to reach as a high percentage of returns, as the investment is worth $ 30 billion. Similarly, when CapitalG's investment in Stripe, the software payment company already cost $ 9 billion.
As a more sub-radar company, CrowdStrike was valued at around $ 700 million when CapitalG invested in 2015, according to SharesPost, WATCH: CrowdStrike CEO George Kurtz for IPO of the company