Cloudflare Hires Ex-Symantec Finance Chief in Move Toward IPO

(Bloomberg) -- Cloudflare Inc. hired Symantec Corp.'s former chief financial officer to fill the same role at the network security company as it prepares for an initial public offering.

Thomas Seifert will join San Francisco-based Cloudflare on Thursday, according to the company.

After considering about 30 candidates over a two-and-a-half year search process, Seifert was the first person Cloudflare made a formal offer to, Chief Executive Officer Matthew Prince said. His public market experience, familiarity with European markets and understanding of cloud-based businesses all contributed to the decision, Prince said.

“Our management team members aren't known entities to the public markets,” Prince said in an interview. “We were looking for someone that had that kind of gravitas to them.”

Cloudflare's technology helps clients run websites more efficiently by speeding up performance, protecting from hacking attacks and analyzing traffic.

Founded in 2009 by Prince, Michelle Zatlyn and Lee Holloway, Cloudflare has raised $182 million from investors including Microsoft Corp., Fidelity Investments and New Enterprise Associates. It currently has an annual revenue run rate -- the most recent month of revenue multiplied by 12 -- of more than $100 million and gross margins of about 80 percent, Prince said.

IPO Preparations

The company is aiming to be ready to launch an initial public offering by the middle of next year, Prince said, though no set listing plans have been made. Seifert will help oversee key parts of Cloudflare's pre-IPO preparations: Assembling internal processes and controls, growing the finance and investor relations team and planning how to position the company to Wall Street.

Cloudflare is joining a steady drumbeat of enterprise technology companies that are moving toward an exit. After a slow 2016, there's been a resurgence of technology IPOs this year: 14 companies have raised a combined $6 billion so far, more than the $3.6 billion raised by 26 companies in the previous 12 months.

Seifert has already had a chance to practice one of the most crucial tasks of a public company CFO: Handling a quarterly earnings call. On a recent mock call -- a practice Cloudflare has implemented in the past year -- Seifert applauded the scripted introduction but said the questions, which come from the company's existing investors, were too soft, Prince said.

Brightstar, AMD

Seifert joined Symantec from telecommunications company Brightstar Corp. in 2014. He previously worked as CFO -- and later interim CEO -- of chipmaker Advanced Micro Devices Inc., taking the reins in 2011 after Dirk Meyer was ousted, but bowing out of being permanently considered for the role. Seifert joined AMD in 2009 after working at German chipmaker Infineon Technologies AG and its spinoff, Qimonda AG, which went bankrupt.

He stepped down from Symantec in November, ceding the role of CFO to his counterpart from Blue Coat Systems Inc., which Symantec agreed to buy last year for about $4.65 billion.

Seifert will be based at Cloudflare's San Francisco headquarters, literally as Prince's right-hand man. The company recently moved into a new office with desks in groups of six, orchestrated by co-founder and head of user experience Zatlyn, who sits to the CEO's left.

“The desk to my right was empty,” said Prince. “I said, ‘Michelle, who sits there?' She said, ‘That's where the CFO sits.'”

To contact the reporter on this story: Alex Barinka in New York at abarinka2@bloomberg.net.

To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Jillian Ward