A Successful Week for Rubrik

Author

Adam Valenta
April 26, 2024

Happy Friday! Rubrik makes a splash with shares soaring nearly 16% on its trading debut, while Norwest Venture Partners confidently secures $3 billion for its 17th fund, undeterred by economic headwinds. In regulatory news, President Biden has signed a law to ban TikTok nationwide unless divested, and the FTC bans Noncompetes.

TL;DR

  • Rubrik’s Shares Surge — Ends trading up almost 16% on public debut.

  • Biden signs law to ban TikTok nationwide unless sold.

  • FTC Bans Noncompetes.

  • Norwest’s Raises $3B for 17th vehicle.

Rubrik shares end trading up almost 16% on the company’s public debut

Rubrik's IPO launched successfully with shares opening at $38, up from an initial price of $32, giving the company a $6.6 billion valuation. The cybersecurity firm, specializing in cloud-based security software, raised $752 million. Despite Rubrik's unprofitable status with growing losses, subscription revenue, which now constitutes 91% of total revenue, signals strong future prospects. Key investors include Lightspeed, Greylock, and Khosla Ventures, with significant stakes held by founders and early backers.

President Biden signs law to ban TikTok nationwide unless it is sold

President Biden signed a law requiring TikTok's Chinese owner, ByteDance, to sell the app within a year or face a U.S. ban. This move marks a significant escalation in the U.S.-China tech conflict but isn't expected to immediately impact TikTok's operations due to impending legal challenges and the complex nature of a potential sale. Despite the controversy, TikTok remains popular in the U.S., with significant user engagement driven by its sophisticated algorithm. However, the law, embedded in a broader foreign aid bill, has sparked debate over free speech and the effectiveness of such bans.

FTC Bans Noncompete Agreements That Restrict Job Switching

The Federal Trade Commission (FTC) has enacted a new rule prohibiting noncompete agreements for workers, aiming to enhance career mobility and foster competition. Passed with a 3-2 vote, this decision targets these clauses as unfair competition practices that suppress wages, stifle innovation, and hinder the formation of new businesses. FTC Chair Lina Khan emphasized that removing noncompetes could lead to the creation of over 8,500 new startups annually by freeing up entrepreneurs. The rule requires employers to notify employees that existing noncompete agreements are void, although it maintains noncompetes for senior executives.

Norwest Venture Partners raises $3B for 17th vehicle, maintaining fund size despite market downturn

Norwest Venture Partners (NVP), backed by Wells Fargo, has successfully raised $3 billion for its 17th fund, matching its previous fundraising effort during the 2021 venture boom. Despite a more challenging investment climate with fewer deals and lower valuations, NVP maintains a steady investment pace, focusing on sectors like growth equity, healthcare, and regions such as India, where deal activity remains robust. The firm has achieved significant exits, including the sale of Spiff to Salesforce and the IPO of Five Star Business Finance in India. NVP's strategy leverages a diversified, global multi-strategy approach, allowing it to adapt to market fluctuations and continue delivering strong returns.

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Talk soon and have a great weekend!

Cheers,

Adam Valenta

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