SailPoint: A Strong Start for 2025 Tech IPOs

SailPoint Technologies, an identity security company, went public for the second time on February 13, marking the first major tech IPO of 2025. The company raised $1.4B at a $12.6B valuation, achieving a lofty LTM revenue multiple of 15.3x.

With 64% gross margins and a 114% net retention rate, SailPoint boasts a strong 30% y-o-y growth. Despite being EBITDA positive, it remains cash flow negative, burning $173M in operations over the past year. The company carries $1.6B in long-term debt with just $68M in cash, while its annual interest expenses total $183M. As a result, IPO proceeds will be used to sustain operations and reduce debt.

SailPoint wasn’t a classic startup debut but rather a leveraged-buyout exit. Previously a public company, SailPoint was taken private by PE firm Thoma Bravo in 2022 at a $6.9B valuation. Following its return to the public markets, Thoma Bravo will retain a 76% stake and could net a $1.4B profit from the IPO.

After seven days of trading, SailPoint’s stock remains within its IPO price range of $23 per share.

This stands in contrast to ServiceTitan, the last major tech IPO in December, which saw its share price surge from $71 to as high as $105 on the first day and continue to trade around $100. However, even with the pop up in price, ServiceTitan is now traded at 11.9x LTM revenue.

Meanwhile, Okta, SailPoint’s primary competitor and three times its size, is currently valued at 6.2x LTM revenue.

Conclusion

SailPoint’s IPO can be considered a success, signaling renewed optimism for the VC industry and the potential reopening of the IPO market — despite expectations that interest rates will not ease in 2025.