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Okta pops big in its IPO and hits a $2 billion valuation
(Okta CEO Todd McKinnonOkta)
April 7 (Reuters) - Cloud software provider Okta Inc's shares jumped as much as 44 percent in its debut on Friday, giving the tech unicorn a market capitalization of about $2.22 billion.
The 11 million-Class A share offering was priced at the top end of the expected price of $15-$17. The company raised about $187 million.
The San Francisco, California-based company's shares opened at $23.56 and hit a high of $24.50 on the Nasdaq.
Okta helps companies organize passwords and authenticate the identity of employees who log into work applications made by other software firms.
The tech company has more than 3,100 customers, including Adobe Systems Inc, American Express, LinkedIn Corp and Allergan among others.
Okta is the latest in a string of cloud software IPOs that investors have warmly embraced, reflecting strong revenue growth and recurring subscription sales that offer greater predictability than many other tech stocks.
Tech IPOs have showed signs of recovery this year, after a dull 2016, when just 20 technology companies went public.
The number of U.S. IPOs more than tripled in the first quarter, with the technology sector leading the issuance market, according to Thomson Reuters data.
Snap Inc, the owner of the popular social media app Snapchat, grabbed attention when it went public early in March with a staggering valuation of $24 billion.
Okta, backed by venture capital firms, including Sequoia Capital, Andreessen Horowitz, Greylock Partners and Khosla Ventures, follows the successful debuts this year of MuleSoft Inc and Alteryx Inc.
Like these software providers, Okta is also not profitable, having posted a net loss of $83.5 million in the year ended Jan. 31, 2017. However, the company's revenue rose about 87 percent to $160.33 million.
J.P. Morgan, Goldman Sachs & Co and Allen & Co LLC are lead underwriters to the offering.
(Reporting by Nikhil Subba and Sruthi Shankar in Bengaluru; Editing by Martina D'Couto)
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