This week for the first time since Ford’s IPO in 1956, the Oracle of Omaha, Warren Buffett, a nickname he earned as one of the world’s greatest investors, made about $800 million off of Snowflake’s (SNOW) market debut.
Buffett generated his wealth on smart, long term investments as well as an avoidance of new and upcoming stocks. He previously stated that investors are commonly buying into IPO’s because of the hype that is usually associated with them rather than the stock itself.
Despite his extreme aversion for IPOs, Buffett’s Berkshire Hathaway invested $250 million worth of Snowflake’s stock at its IPO price, and an additional $4.04 million shares from a stockholder at the debut price. Since, Snowflake’s shares have surged a shocking 111%. Snowflake started their debut at $120 and climbed to a peak of $300, giving Buffett and Berkshire Hathaway nearly $1 billion in paper profits on day one.
Snowflake was co-founded in 2012 by Marcin Zukowski, Benoit Dageville, and Thierry Cruanes. Snowflake’s founders “started from scratch and built a data platform that would harness the immense power of the cloud” (Snowflake 2020). They then engineered Snowflake to power the Data Cloud, by doing so they were able to give thousands of organizations access to explore, share, and learn the true value of their data.
Snowflake managed to grasp the attention and equity of one of the world’s best long term investors — could this be the company that changes data analytic services? We know that cloud technology is the future so expect more companies such as Snowflake to arise…