It has three external CEOs instead of the founder-led culture that dominates most of the tech industry.
Frank Slootman, Mike Spieser, and Bob Muglia came from vastly different situations to serve as Snowflake’s external CEOs.
Slootman came out of retirement because he thought Snowflake was such a great idea.
The founders of Snowflake are Benoit Dageville, Thierry Cruanes, and Marcin Zukowski, who all hold other executive positions within the company.
Snowflake’s value is around $81 billion, but its global data storage generated $88 billion with a capacity of 700 exabytes.
Snowflake also is the third-largest company in the data storage space, with a 10.08% market share.
The company Gartner commends Snowflake for its “completeness of vision” and “ability to execute.”
What is a database?
Of the two types of databases, transactional and analytical, Snowflake excels as an analytical database.
Transactional databases: Data is generated through the little transactions that happen every time a user takes an action, which allows developers to store user emails, accounts, preferences, etc.
Analytical databases: These are more resource-intensive, multifaceted spaces where data is examined in order answer questions critical to business, such as: How often did users log in? Where are they based? What was the most popular pricing plan?
Data warehouses can copy information from transactional databases into new analytical databases.
Snowflake is a managed data warehouse, which means that users can just enter their data into Snowflake, and the company analyzes the data quickly.
Snowflake’s prowess with infrastructure pieces like storage and compute makes its efficiency much better.
Snowflake also has a level of flexibility in terms of its cloud provider because it can run on AWS, Azure, or GCP.
Although Snowflake provides convenient data management, its fully managed services are expensive.
The UI and SQL (Structured Query language) are also very clean and easy to use.
Snowflake also has some data-sharing capabilities that are still relatively immature.
Instead of charging per seat or on a monthly basis, Snowflake bills based on customer usage.
They bill on-demand or upfront based on storage, compute, and cloud services.
This model is catered towards large enterprise contracts which Snowflake focuses on. Examples are Office Depot, McKesson, Nielsen, DoorDash, Capital One, and Instacart.
Executive compensation is mostly a cash salary that has an equity and non-equity component.
Slootman – 5.9%
Dageville – 3.9%
Muglia – 3.3%
SHV (External Investor) – 20.3%
SHV is a large VC firm, and Snowflake runs its sales and go-to-market teams through SHV.
Other outside investors:
Altimeter Partners – 14.8%
ICONIQ Partners – 13.8%
Redpoint Ventures – 9.0%
Sequoia Capital – 8.4%
Snowflake’s revenue has expanded 173% over the last two fiscal years.
Customers are using Snowflake more often, as their net revenue retention is around 223% compared to 2019.
However, Snowflake’s margins are relatively modest, around 60%, due to its reliance on cloud providers.
Snowflake’s IPO valuation is around $25 billion.
Snowflake’s biggest competitors are Amazon, Google, and Microsoft.
It will be interesting to see how the Coronavirus affects Snowflake’s value in the future.