Ubuntu’s Parent Company Canonical is Heading for an IPO

Wall Street

Earlier this year in April, Canonical, the creators of Ubuntu, announced that they would be making some major changes. One of the biggest changes was the end of development for the Unity desktop and Canonical’s mobile efforts. There were also a large number of layoffs.

At the time, Abhishek wondered about the possibility of an IPO (Initial Public Offering). He wasn’t alone. I remember reading several articles and even listening to a couple podcasts, that suggested the same thing.

In a recent eWEEK interview, Mark Shuttleworth, the founder, and CEO of Canonical announced just that.

He said in part “What you’ll see at some stage soon is that we have broken even on all the pieces that we do commercially without Unity. At some stage after that, we will take a round of investment which will be a growth round and that will be aimed at helping us to become a public company in due course.”

This is a significant move. For many years, Shuttleworth has bankrolled the development of Ubuntu. It appears that he is looking for investors to help push the company to the next level.

Not the First Linux company to go public

Canonical is not the first Linux-based company to consider going public. Red Hat, the company behind Fedora Linux, went public in 1999. Currently, their stock is valued at over $120 a share. Today Red Hat is a billion dollar company.

However, having an IPO does not automatically mean success. VA Linux followed in Red Hat’s footsteps and jumped into the market several months later. Their path wasn’t quite as rosy. Today known as GeekNet, the company is no longer involved in Linux development. The massive failure of this IPO caused ripples that were felt for years.

Thoughts

I think that this is a big step of Canonical. It will go a long way to give them an air of legitimacy. Make them one of the big boys. It certainly worked for Red Hat.

In 2016, Red Hat revenues of $2.6 billion. Since Canonical is a private company, their numbers are not readily available. They did reveal in 2014, that they have revenue of $21 million in 2013.

As I noted above, having an IPO does not mean automatic success. Shuttleworth is going to keep his eye on the ball. Now that he has returned to his duties as a CEO, he seems ready to do that. Hopefully, he doesn’t bring people in the management circle of Canonical who understand running a public business but don’t understand the importance of the open source foundation it is built on.

Over the past few years, awareness of Linux in general and open source overall has increased. This has happened mainly through the spread of Android (though it’s not quite open source anymore). This new awareness should hopefully bring investors who understand what Canonical and Linux as a whole stands for.

Good luck, guys.

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  • If Ubuntu is made into a paid (commercial) software, but open source, I am quite ok with it. After all, the developers do need to be paid.

  • Hoping that they don’t go bankrupt and actually know what they are doing! :) Still a Mint user and I like small companies!

  • Oh and watch as Microsoft dances with Glee. Canonical are teetering, Microsoft known this, its why they”partnered” with Canonical. Ubuntu will, over time become in part proprietary/

    • If Ubuntu becomes part proprietary, then there is Debian, CentOS, PCBSD (trueOS), all free. It would involve a lot of effort by Microsoft to metamorphose Ubuntu to part proprietary as the basic structure of both the OSs is poles apart.