Last April, flash storage startup Pure Storage was raising money at a valuation north of $3 billion.
There were some whispers that it might have been swept up in the tech valuation bubble especially considering that the flash storage space - basically first class data storage - was suddenly getting a bit crowded. But Pure Storage was unfazed and confident enough to file its IPO papers a few weeks ago.
So, who was right?
The flash storage provider went public Wednesday, but began trading below its $17 IPO price, and closed the day at $16.01.
That gives Pure Storage a market cap of around $2.9 billion, slightly below the $3 billion-plus private market valuation it garnered last year.
Like many tech startups entering life as a public company, Pure Storage is hemorrhaging cash and relying on the 'promise of what's to come' to make good on its pre-IPO "value." Wall Street has been increasingly iffy on this whole game lately (Ahem... Etsy) and Pure Storage seems to have gotten itself caught right in a cynical moment.
Or maybe it's just not as promising an idead as it thought it was.
So was Pure Storage's IPO a matter of overvaluation?
Well, don't ask Pure Storage President Dave Hatfield, because he doesn't know sh!t about valuations.
“We’re not experts on the valuations of the business. We’re focused on creating value for customers and delivering consistent financial results in a really big market,” he said.
Who is, Dave? Who is?