MongoDB Projects $100M from IPO

MongoDB Inc is getting ready to go public. The company "confidentially" filed for an IPO last month -- the quotes are because it was a widely reported "secret" -- and officially filed with the SEC on Thursday. When it's public, expect to see it listed on NASDAQ under the symbol "MDB."

Considering that the open source database company has been around since 2007, some might say it's about time. Others might be surprised the company is still around. Ten years later, it's still in the red and keeping the doors open is costing it tens of millions of dollars annually.

As they say, it takes money to make money.

The bad news about the company's finances, according to Business Insider, is that in the six months that ended on July 31, the company reported a loss of $45.76 million on revenue of $67.9 million. The good news is that figure shows positive growth. During the same period in 2016 its revenue was only $45.1 million -- if you can ever put "only" before a dollar amount above a million.

The company also seems to slowly be on the road to profitability. The latest figures show a per share loss of $1.71 compared to $1.93 in 2016.

Also good news: the company doesn't seem to be desperate for cash. Between 2007 and 2015, the company raised about $303 million in seven funding rounds, and hopes to raise another $100 million in its IPO.

The backbone of MongoDB Inc is its NoSQL database, released as an open source project in 2009 and which began seeing considerable adoption almost immediately. Three years after the release it made a ninth place showing on The Wall Street Journal's "The Next Big Thing 2012" list and by 2014, when I spoke with co-founder and board chairperson, Dwight Merriman, the DB was already driving the back ends at Craigslist, eBay, SourceForge, Viacom, the New York Times and others.

When I spoke with Merriman, he explained that the company uses what the open source world calls an "open core" model.

"We have an Enterprise edition that is non-free," he said. "The Enterprise version has a lot of advanced security features, for example. We’re really trying to find those features that highly correlate with big enterprise usage and then saying if you want kerberos support, that’s in the enterprise edition, that is not free."

In addition to the Enterprise edition, these days the company pushes a Database-as-a-Service offering, MongoDB Atlas. Although the service sells for between $0.12 to $12.87 per hour, in March the company began offering a free tier with 512 MB of storage in an attempt to attract developer interest in an age when people expect the cloud to do all their heavy lifting.

MongoDB also has a growing customer base. In January 2015 the company had 1,100 paying customers. As of the end of July, the number had risen to 4,300. An increased customer base means the expense of increased staffing, of course. In 2015 the company had 383 people on its payroll. Today the number is 820.

The company's main competition is from the big legacy database players, the likes of IBM, Oracle and Microsoft, non-relational database providers, and from public cloud providers such as Amazon Web Services, Google Cloud Platform and Azure.

"Legacy database vendors have historically dominated this market," Mongo said in its filing. "We believe this market is one of the few within the enterprise technology stack that has yet to be disrupted by a modern alternative, creating our opportunity."