Elastic is a technology company focused on internal company data, with offerings across search, security and logging.
ElasticJanuary 17, 2021
Update - Elastic stock jumped 7% on the news they were changing their open-source software licensing. As a reminder, Elastic provides software tools that allow companies to utilise their internal data. Their primary product, ElasticSearch, allows companies to better query their data for search results. Elastic pride themselves on being an open-source company, which has meant their software is available for free on a self-managed basis. Whilst great for developer uptake, it can be concerning for investors. Essentially, the new license better protects against competition. It follows a similar move made by MongoDB in 2018, who have a similar business model and have been very successful after making the switch. This open-source licensing was previously seen as a business risk, so this move makes sense as part of the company growing-up and building a moat. CEO Shay Banon commented: “The community has come to appreciate that open-source companies need to better protect their software in order to maintain a high level of investment and innovation.”
This also followed an impressive quarterly announcement. Elastic grew revenues 43% YoY with their Saas revenues up 81%. They also announced 650 customers with annual contract value of over $100,000, up from 525 the previous year.