Cloudflare raises $525 million in IPO

Cloudflare Inc., a firm that helps websites protect and distribute content, priced its shares above an already elevated target to raise $525 million.

San Francisco-based Cloudflare sold 35 million shares on Thursday for $15 each, the company said in a statement confirming an earlier report by Bloomberg. On Wednesday the company had increased its target ranged for the shares to $12 to $14, after earlier marketing them for $10 to $12.

Cloudflare is valued in the listing at $4.4 billion based on the shares listed as outstanding in its filings with the U.S. Securities and Exchange Commission

About 10% of Fortune 1,000 companies are paying Cloudflare customers, according to its filings. The company said its security services blocked an average of 44 billion cyber threats a day during the second quarter.

For the first six months of the year, Cloudflare lost $37 million on revenue of $129 million, compared with a loss of $32 million on revenue of $87 million for the same period last year, it said.

8chan, Shootings

Cloudflare acknowledged in its filings that its risks included negative publicity from the use of its network by 8chan, a website favoured by white supremacists and used by gunmen before mass shootings in El Paso, Texas and Christchurch, New Zealand, this year. It also cited the use of its services by neo-Nazi website the Daily Stormer around the time of the 2017 protests in Charlottesville, Virginia.

Conversely, it also faced concerns about censorship for terminating the accounts of such groups, it said.

The company has a dual-class stock structure giving its Class B stockholders 10 votes per share, according to its filings. Co-founder and Chief Executive Officer Matthew Prince will control 12.9% of the company and have 17.1% of the voting power, the company said.

The offering is being led by Goldman Sachs Group Inc., Morgan Stanley and JPMorgan Chase & Co. Cloudflare’s shares are expected to begin trading Friday on the New York Stock Exchange under the symbol NET.

Now read: Cloudflare cuts support for 8chan

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Cloudflare raises $525 million in IPO