Mulesoft Rings the Bell

March 17 may be known for being St. Patrick’s Day to most reading this article — but for the team at Mulesoft, this day was far more special. On March 17, Mulesoft rang the bell on the New York Stock Exchange (NYSE), marking the end of their first day of trading as a public company under the MULE symbol.

Mulesoft closed their opening day at $24.25/share, over the expected $17.00/share market, selling 13 million shares to raise $221 million.

This is certainly a milestone day for Mulesoft and it reminds me of late 2015 when Atlassian became a public company. By comparison, Atlassian (NASDAQ:TEAM) raised $462 million at a strike price of $21.00/share during their IPO on December 9, 2015.

So, what can we expect from Mulesoft now that they have obtained their IPO?

Category-Defining Company

Mulesoft is focused on creating a category-defining company. To me, this means they are focused on becoming the de facto standard in a new category that is comprised of their strengths. Similar to how Google defined the search market, Salesforce defined the CRM space,= and Amazon defined the online shopping experience.

Mulesoft is certainly on their way toward meeting this goal, quickly becoming the leader in the integration market. Unlike Google, Salesforce, and Amazon, Mulesoft has a bigger challenge since their space is truly more IT-related and less likely to become a household name. However, securing more Fortune 500/1000 firms should pave the way for smaller corporations to be willing to apply a portion of their budgets toward Mulesoft offerings.

Reduction of Losses

One of the biggest challenges Mulesoft faced going into their IPO is the losses they had reported in prior years. Now that they are a public company, shareholders will have the expectation that losses are reduced, or at least justified by features or enhancements that will drive future revenue.

Shareholders should find comfort in knowing Mulesoft's losses were reduced from $65 million to $50 million in 2016, while revenue for that same time period grew from $110 million to $188 million. As more customers embrace Mulesoft's subscription-based services, those numbers are expected to improve, given the investment for the key infrastructure has already been made.

Targeted for Growth in the API and Integration Market

Mulesoft has an amazing suite of products, leveraging a robust library of connectors and utilities focused on removing painful point-to-point connections between disparate applications. Considering point-to-point integration is a $500 billion market, Mulesoft is placed nicely to resolve those point-to-point challenges. With every passing month, their abilities and features continue to evolve, yielding a profound niche in not only the integration space, but the API security/management space as well.

For those who follow the Gartner Group, Mulesoft often appears in the top right corner of three to four Magic Quadrants continually. In 2016, I was part of a team that successfully utilized Mulesoft to integrate and secure multiple applications as a part of a CRM conversion. I can speak from experience that Mulesoft has proven solutions that meet the needs we were seeking.

With an already impressive list of Fortune 500 companies utilizing their products, the expectation is that more corporations will give Mulesoft a serious look as their Information Technology divisions seek solutions with their API and Integration space.

Conclusion

March 17 will forever remain a positive milestone for Mulesoft. They are in the driver's seat to build upon the millions they raised during their IPO. If they continue to drive toward becoming a category-defining company, keeping their losses in check and continue to capture on the growing need for integration solutions, they should thrive in today's market.

What are your thoughts? How important are the products and solutions Mulesoft provides to your Information Technology needs?