Power Score: 45.99 Momentum Score: 44.0 (5) HQ: Mountain View, CA CEO: Shay Banon


Valuation: $12.7 billion (+59% YoY)

Amt. Raised: $104 million


Lobbying Spend: No

Industry Orgs: No


Headcount:2,363 (+17% YoY)

Engineering Headcount: 705 (+11% YoY)

Big Tech Experience: 7%

Open Roles: 3,246


R&D Spending: $199.2 million (+21% YoY)

Patents Applied For: 0

Patents Owned: 20

Acquisitions: No


Exec Team Exits: No

Diversity Data: No

ESG/CSR Data: No

On Power

Though it sells observability software, Elastic is not an observability company; at least that's what it says on the first page of Elastic's latest 10-K. It's a search company at its core, but, of late, Elastic has leveraged its deep roster of clients to become a formidable presence in the observability space. This resulted in growth that allows Elastic to pose a challenge to the largest players in the sector. The company has said it currently has more than 15,000 customers across its enterprise search, monitoring and security businesses, and recent efforts to capitalize on pandemic-related digitalizations and bridge each of those services with its Elastic Stack offering have had a positive effect on Elastic's recurring subscription revenue. In February 2021, CEO Shay Banon noted that observability now makes up the largest chunk of the company's overall revenue at 40%, but that its security business is the fastest growing segment. Still, as Elastic continues to put more emphasis on selling an all-in-one solutions incorporating a larger share of the stack, its current inroads with companies for portions of its business put it within striking distance of the top of the list

On Disruption

Elastic's relationships with the public sector could prove important as the company beefs up the Elastic Stack, or what it calls a "single agent." In the last year, the company achieved Moderate FedRAMP authorization for Elastic Cloud, putting it on par with Splunk and ahead of Datadog. Additionally, as the company has leaned into its newer monitoring and security businesses, CEO Shay Banon has made a habit of saying, "While you observe, why not protect?", a nod to the broader strategy of having its businesses complement one another (and perhaps also a reference to a certain famous hard-shell taco commercial).

Tea Leaves

The Elastic Agent, which, for "Lord of the Rings" fans, has been called "The one agent to rule them all," is currently in Beta. At the time of its initial launch, Banon told investors it was "the development [he] was most excited about," and as the product nears a full release, it will allow Elastic to feature one-click data onboarding as well as an easier way for customers to up-level their usage of the observability tools by adding endpoint security. Still, it's impossible to ignore the headwinds that come in the form of Big Tech. AWS's recent launch of OpenSearch will compete directly with Elastic's enterprise search business following Elastic's retreat from Open Source, and will likely prove to be a challenge for Elastic at a time when the company has placed an emphasis on cross-pollination of its services among its clients, especially as the backlash from developers over the change of course mounts.

They Said It

"Observability represents north of 40%; Enterprise Search, less than 33%; and Security represents around 20% of our business now, and it's our fastest growing. But we treat all of that as the same data. And while you observe, [you] want to protect, and we believe that all the Observability data can be heavily used and harnessed toward better protecting companies as well." — CEO Shay Banon in a June 2021 earnings call