Palantir Technologies is preparing to file a confidential S-1 with the Securities and Exchange Commission (SEC) in the coming weeks and could go public before year's end. The data mining company was founded nearly 17 years ago by Peter Thiel and other PayPal (PYPL +1.70%) alumni, including Nathan Gettings and Joe Lonsdale.
Company executives have yet to determine what path to take to the public markets, debating between a traditional IPO or a direct public offering. The latter offers companies that don't need to raise capital the option to bypass the typical "road show" presentations to investment bankers and list directly on an exchange, a more cost-effective and direct path to the public markets.
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In 2019, Palantir reportedly had revenue of $739 million, up 24% year over year, and contract backlogs of $2.2 billion. The company expects to generate revenue of more than $1 billion in 2020, up 35%, while also expecting to break even for the first time this year.
Palantir gathers data from public and private databases and uses artificial intelligence (AI) to analyze the information it gathers. The process can find patterns in data collected from police reports, addresses, credit card transactions, biometrics, criminal records, vehicle information, photos, and phone records.
The company has performed services for more than a dozen U.S. government agencies, including the Central Intelligence Agency (CIA), the Department of Defense (DOD), and the National Security Agency (NSA), and was hired by the Centers for Disease Control (CDC) during the coronavirus pandemic.
Palantir keeps a low profile and has been notoriously secretive about its processes, having many of its customers sign non-disclosure agreements because of the sensitive nature of its work. Palantir has raised more than $2 billion in venture capital funds since its inception and is currently valued at about $20 billion.
