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Snowflake Gives Investors a Rare Opportunity to Disrupt Amazon

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(Bloomberg) — Snowflake Inc. is riding a wave of enthusiasm leading to its public offering Wednesday, highlighting optimism that the cloud-computing company can more than hold its own against the technology industry’s toughest rivals.

The San Mateo, California-based company, founded in 2012, is seen as a market leader in a key product area dominated by Amazon.com Inc., the top provider of public cloud storage and services. The software maker has also generated blockbuster revenue growth and customer loyalty, according to a regulatory filing.

Snowflake bumped its IPO price range to $100 to $110 a share from $75 to $85, bringing the amount it’s trying to raise to as much as $3.08 billion. The offering could produce a market value of $30 billion for Snowflake, which was last privately valued at about $12.5 billion.

The company’s software is like a vacuum sucking up data strewn across in different systems, so that businesses can analyze it all together. The product was built for the cloud era, in which software is delivered over the internet, and Snowflake’s offering is agnostic about where data is stored and where corporate customers want to aggregate it. Clients query that data to understand more about how their businesses are functioning and make better decisions. Snowflake processed an average of 507 million customer queries per day in the month ended July 31, according to the filing.

Amazon led the way in creating the market for computing power, storage and services rented by businesses, helping them avoid running their own data centers. Analysts said the capabilities and flexibility of Snowflake’s product make it more advanced than the competing data warehouse, called Redshift, from Amazon Web Services, which explains the smaller company’s torrid growth rates.

“It’s a rapidly evolving competitive landscape,” Zane Chrane, an analyst at Sanford C. Bernstein, said in an interview. “AWS Redshift probably has the largest cloud data warehouse, with the most customers and revenue, but it’s the oldest. Snowflake has been one of the most disruptive new vendors in the enterprise space in the last few years.”

In the fiscal year that ended Jan. 31, Snowflake’s revenue soared 174% to $264.7 million compared with the previous fiscal year, the company reported. In the sixth months that ended July 31, sales were $242 million, a 133% year-over-year increase.

These lofty figures have excited investors looking for pandemic-proof securities. Berkshire Hathaway Inc. and Salesforce.com Inc. both snapped up stakes in Snowflake in private placements concurrent with the public offering.

Snowflake also competes against, and partners with, Microsoft Corp. and Alphabet Inc.’s Google Cloud Platform. The company was founded by Benoit Dageville, Thierry Cruanes and Marcin Zukowski. A longtime Microsoft executive, Bob Muglia, led the startup for five years before being replaced by Frank Slootman in April 2019. The board wanted a leader with more operational experience and a strong plan to go after larger customers, according to a person familiar with the situation who asked not to be identified discussing personnel decisions. Slootman had been chief executive officer of ServiceNow Inc. and Data Domain Inc. when those tech companies went public. A spokeswoman for Snowflake declined to comment.

The Dutch-born Slootman often touts Snowflake’s competitive prowess, saying that it has replaced AWS “thousands of times.”

“It’s an extremely compelling product that we have,” he said in a December interview.

Mandeep Singh, an analyst at Bloomberg Intelligence, said Wall Street is poised to richly value Snowflake partially because of confidence that Slootman can effectively navigate a $70 billion market.

“Frank gives Snowflake so much credibility,” Singh said in an interview. “He has been there, done that with ServiceNow. The market is willing to pay a rich premium for cloud companies that have a defensible moat and sustainable market.” Shares may hit $150 when trading begins on the New York Stock Exchange, Singh added.

Slootman has focused on landing very large clients. The software maker has recently been reaching eight- and nine-figure deals, said the person familiar with the situation. Snowflake’s contract with Capital One Financial Corp. was valued around $100 million, the person added.

In December, on the sidelines of an AWS conference, Slootman recounted his conversations with Andy Jassy, the Amazon division’s CEO.

“When I talk to Andy, he’s like, ‘It’s a big market, let’s be civil’ and I think he’s right,” Slootman said. “He said, you know, ‘You guys make us better’ and there’s no doubt.”

For more articles like this, please visit us at bloomberg.com

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©2020 Bloomberg L.P.

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Christine founded Sports Grind Entertainment with an aim to bring relevant and unaltered Sports news to the general public with a specific view point for each story catered by the team. She is a proficient journalist who holds a reputable portfolio with proficiency in content analysis and research.

Christine founded Sports Grind Entertainment with an aim to bring relevant and unaltered Sports news to the general public with a specific view point for each story catered by the team. She is a proficient journalist who holds a reputable portfolio with proficiency in content analysis and research.

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Kenya anti-graft agency slams procurement of COVID-19 equipment

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Kenya anti-graft agency slams procurement of COVID-19 equipment

By Humphrey Malalo

NAIROBI (Reuters) – Kenya’s anti-corruption agency has documented evidence of “criminal” behaviour by officials over the procurement of COVID-19 emergency equipment, said a report presented to the Senate.

The Ethics and Anti-Corruption Commission began investigating allegations of graft in June over the procurement and supply of COVID-19 equipment by the Kenya Medical Supplies Authority. The commission said there was “irregular expenditure” of 7.8 billion Kenyan shillings ($71.96 million).

The revelations come at a time when medical staff in the East African nation have gone on a series of strikes over low pay and poor-quality protective equipment to treat COVID-19 patients. [nL4N2FN1WR]

“The investigation established criminal culpability on the part of public officials in the purchase and supply of COVID-19 emergency commodities at Kenya Medical Supplies Authority (KEMSA) that led to irregular expenditure of public funds,” the commission said in a report it sent to lawmakers on Wednesday.

The watchdog shared its preliminary findings with the Director of Public Prosecutions and has recommended charges against some officials and a system-wide review at the procurement authority to “seal corruption loopholes in future.”

A spokeswoman from the Health Ministry was unavailable for comment. KEMSA is a state-run agency which comes under the ministry.

The head of KEMSA was suspended last month over allegations that it had procured low quality items and inflated prices of others.

In a separate report seen by Reuters on Thursday, the Public Procurement Regulatory Authority catalogued instances of alleged inflation of prices for products procured by KEMSA.

Paracetamol tablets sold at 40 shillings per pack were bought for 66.50 shillings during the pandemic, while alcohol-based sanitizers priced at 313 shillings were purchased at 495 shillings, the report said.

“There was no evidence of indicative price indices obtained through market survey,” the report said.

It also alleged that most “tenders were retrospectively negotiated and evaluated after the deliveries” and “some of the negotiated prices were not as per the prices as proposed.”

Last month, police teargassed protesters in Nairobi during a demonstration against alleged corruption in the procurement of protective gear meant for defence against COVID-19.

Health workers in Kenya have posted images on social media showing what they claim is inadequate protective equipment provided to them, such as porous dust overalls that would not prevent the spread of the virus.

($1 = 108.4000 Kenyan shillings)

(writing by Omar Mohammed; editing by Katharine Houreld and Alexandra Hudson)

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Ben Affleck, Gal Gadot, Henry Cavill Back for Justice League Reshoots: Report

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Ben Affleck, Gal Gadot, Henry Cavill Back for Justice League Reshoots: Report

Ben Affleck, Gal Gadot, Henry Cavill Back for Justice League Reshoots: Report | PEOPLE.com

























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Costco Wholesale beats Q4, says it was impacted by covid-19 premium wage expenses and sanitation costs

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Costco Wholesale beats Q4, says it was impacted by covid-19 premium wage expenses and sanitation costs

Costco Wholesale released its fourth quarter earnings report after hours on Thursday, beating investor expectations on both revenue and earnings per share. The company said that it was negatively affected by coronavirus premium wage expenses and new sanitation costs. Yahoo Finance’s Myles Udland breaks down the company’s earnings report on The Final Round.

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