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Shares of newly public search technology firm Elastic N.V. are soaring in Friday trading, opening up nearly double from their IPO price and holding onto gains an hour after the open.
Elastic, based in Mountain View, Calif., (though it is officially incorporated in The Netherlands), saw its offering of 7 million shares many times over-subscribed. The price last night, $36, was above an expected offering range of $33 to $35. That range was itself up from an initial expected range of $26 to $29.
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The offering will raise $252 million for the company, based on its selling 7 million shares. Following the deal, Elastic, with nearly 70 million shares outstanding, will be worth roughly $5 billion, at a recent price of $71.69.
The technology is used in a variety of search functions, such as matching up drivers for Uber and Lyft ride-sharing, or matching up people on Tinder’s dating application. Cisco Systems uses the software to sift and sort product listings for its e-commerce portal. Sprint uses the technology to manage billions of records daily for its retail store operations, including server, database, and application logs, e-mails, and API calls coming from retail locations.
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The software can be used in multiple public cloud computing environments, installed on-prem, or in a hybrid configuration. More details and customer examples are contained in the company’s S-1 prospectus.
Elastic emphasized the speed and scale of its software. For example, here’s how the company described its speed:
“Everything stored in Elasticsearch is indexed by default, such that users do not need to decide in advance what queries they will want to run.
Our architecture optimizes throughput, time-to-data availability and query latency. Elasticsearch can easily index millions of events per second, and newly added data can be available for search nearly instantly.”
As an example of scale, the company cited searches on Tinder, where “more than 17 billion events and 300 million Elasticsearch queries [are] performed every single day.”
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