Unqork stock got another big boost recently. Last week the company – which operates a low-code platform — announced a Series C funding for $207 million, bringing the valuation to $2 billion. The investors on the round included BlackRock (NYSE:BLK), Fin Venture Capital, Hewlett Packard Enterprise (NYSE:HPE), Goldman Sachs (NYSE:GS), Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and Aquiline Technology Growth.
The CEO and founder of Unqork is Gary Hoberman, who has about 25 years experience in IT (Information Technology) in the financial services industry. During his career, he worked at firms like Metlife (NYSE:MET) and Citigroup (NYSE:C). He was also able to publish seven patents.
But when he started Unqork, he experienced considerable skepticism. Out of 300 investor pitches, he got zero interest. Part of this was due to Hoberman’s focus on the enterprise market, which is difficult to crack. Yet there was also concern that he was too old! When he started to raise funding, he was 45.
Because of this, Hoberman initially bootstrapped the startup. This certainly turned out to be a very good decision.
Unqork is a full-blown system. First of all, it has a visual interface that makes it much easier to develop enterprise applications. It’s possible to quickly build sophisticated workflows that have forms, access to APIs (Application Programming Interfaces), automated tasks and business rules.
Next, Unqork has integration across a myriad of legacy systems. There is even a way to process a paper document and turn the data into machine readable formats. Finally, there are tools to manage and monitor the performance of the apps. This includes version control and reversion capabilities. All this is backed up with advanced systems for enterprise-grade security.
Unqork has certainly proven very strategic for customers because technology has become a competitive necessity. But traditional approaches to app development are usually too expensive and time-consuming, such as by using custom software development. Off-the-shelf software is also lacking as it usually does not meet enough of the requirements.
So what makes low-code so powerful is that a customer can get the benefits of both the customization of software development and the lower cost of off-the-shelf technologies. Low-code also tends to be easier for maintenance. Keep in mind that maintenance can eat up over 60% of the IT budget.
The Market Opportunity
One of the risks for Unqork stock is the competition. The low-code market has a myriad of large players, such as Microsoft (NASDAQ:MSFT), Salesforce.com (NYSE:CRM), ServiceNow (NYSE:NOW) and Oracle (NYSE:ORCL). But of course, there are also many fast-growing smaller operators that are making gains. Just some include Appian (NASDAQ:APPN), Mendix, Zoho and Quick Base.
As low-code gets more popular, there will certainly be more startups that emerge, fueled by the aggressive private investing of venture capitalists.
But it’s important to keep in mind that the market opportunity is large. According to Prescient & Strategic Intelligence, the spending is forecasted to go from $5.6 billion in 2018 to $52.3 billion by 2024. In other words, the market should be big enough for multiple players.
Bottom Line on Unqork Stock
Growth has been robust with Unqork. For the past three years, the ARR (Annual Recurring revenue) has increased at triple-digit rates.
So what about an IPO? Will Unqork stock soon be available for everyone? Well, the company has recently hired a CFO (Chief Financial Officer), Dan Murphy. Prior to this, he was the CFO and COO (Chief Operating Officer) at Namely and the CFO at LivePerson (NASDAQ:LPSN).
Thus, the company is making the kinds of moves for a public offering. Although, in terms of timing, a deal is probably not imminent. Unqork is still a young company and will probably need some time to build its processes and revenue base. As a result, it may take a few years until we see an IPO.
On the date of publication, Tom Taulli did not have (either directly or indirectly) any positions in any of the securities mentioned in this article.
Tom Taulli (@ttaulli) is an advisor/board member for startups and author of various books and online courses about technology, including Artificial Intelligence Basics, The Robotic Process Automation Handbook and Learn Python Super Fast. He is also the founder of WebIPO, which was one of the first platforms for public offerings during the 1990s.