When Pure Storage did its IPO, in October 2015, the company was six
years old and had completed six rounds of private funding. It could have
gone public a year or so earlier, and the CEO realized that waiting
entailed risks. In fact, the IPO market was cooling, and companies were
pulling their offerings as a result. But staying private longer may have
significant advantages as well. In retrospect, Dietzen believes that
the timing worked out well for Pure. Among the factors that influenced
the decision to wait: Sarbanes-Oxley has made it more expensive to be a
public company; staying private would make it easier to fend off M&A
interest; and the precedents set by Google and Facebook, which waited
much longer than venture-backed companies have historically, drove a
change in the conventional wisdom. Nevertheless, Pure’s customers
encouraged an IPO, because many of them preferred to do business with a
public company, whose financials are available for scrutiny. In
preparation for the offering, Pure gave employees flexibility with their
stock options, expanded the board, and hired a strong CFO. Happily, in
the months surrounding the IPO, two key competitors were distracted by
internal events. Although the company’s stock price has fluctuated,
Dietzen says, today Pure is a fast-growing and healthy business.
[ABSTRACT FROM AUTHOR]