Who in the world could have ever imagined that a startup CDN catering to the SME /SMB marketplace, and providing free CDN service as one of it options could be more valuable than Akamai one day? Certainly not Akamai. Earlier in the year, Matthew Prince stated that CloudFlare was growing “at a 350% compounded annual rate for the last three years” and they were on track to reach a $100M revenue run-rate by year end. Furthermore, Prince stated that CloudFlare could reach $7.8B market valuation when they go IPO in 2017, because their revenue growth closely resembles Workday.
Mathew Prince was wrong. Surprisingly, he set the bar way too low, about 50% too low. CloudFlare is not Workday, but something much better.
If CloudFlare grows its $100M annual business by 350% in 2016 and 350% in 2017 – that’s a $1.2B business. Do you know you has a $1.2B business? Palo Alto Networks and they are presently valued at $15.97B, which is about $5B more than Akamai. CloudFlare may in fact be the new Palo Alto Networks of the CDN world, even more so as the era of the security appliance comes to a screeching halt in couple of years, and the cloud security utility model takes over. Nothing anymore is too far fetched in this crazy business.