
Palantir, Tech’s Next Big IPO, Lost $580M in 2019 - simonpure
https://www.nytimes.com/2020/08/21/technology/palantir-ipo-580-million-loss.html
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jshaqaw
Sales and marketing costs at 60% of revenues last year? My understanding of
Palantir is that this isn't some SaaS model where a fixed cost product can be
scaled at huge gross margins. This is a niche IT consultancy coming up on two
decades of life. Today's stock market of hype dream valuations is their window
to offload this to the public and clearly they know it.

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ganoushoreilly
While it's been years since I was in a location with the tech deployed, it was
100% a consulting first gig. Nothing was done without an Palantir Engineer.
The sad thing is the extra expenses not accounted for in the contracts too.
For example, the clearances / costs were often covered by host agencies (at an
extremely steep price) for the analysts, something usually passed on to the
vendor to cover. So in a sense, they paid for software, paid for an employee,
and paid all the associated fees to clear / maintain the employee. I don't
think this flys in the private sector at all and it shows with their limited
client base.

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stevehawk
All clearances are paid for by the government, they are never billed to the
vendor. If they charged the contractors then small businesses would never be
able to compete. Hell, medium businesses wouldn't be able to compete.

There is an estimated cost of said clearances, as needed so the government can
try to budget accordingly, but it is not handed down to vendors.

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ganoushoreilly
I'm not sure I agree. Usually the Prime has negotiated it as part of their fee
package, but there is most certainly fees for applying and granting clearances
for third parties. There's even more fees for establishing a proper SSO and
certifying as well. We had a default 50k cost barrier for any new TS/SCI
candidates we put forth. Sometimes this was reimbursed, but it was most
definitely a _good faith_ cost we incurred.

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stevehawk
it would blow my mind if you tell me you know a company that has written a
literal check for a security clearance in the last twenty years.

i suspect that cost barrier is more the government saying "we aren't paying
for it, you need to find someone that is already cleared."

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sidcool
I am yet to understand exactly what Palantir does.

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danpalmer
From what I understand, it's essentially data engineering, and tools on top of
data pipelines.

They claim to sell products, and those products probably form an underlying
part of what clients are buying, but really they are paying for a developer to
sit in their office and build ETL code to get data out of their million
unmaintained databases into some vaguely coherent system, and then build
reporting, views, and simple workflows on top of that data.

This doesn't sound like much, but I can understand why that might be
transformational for many businesses, to finally have all their data in one
place in a way that can be analysed usefully.

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sneak
[https://www.theverge.com/2013/6/29/4478748/california-
licens...](https://www.theverge.com/2013/6/29/4478748/california-license-
plate-reader-database-palantir)

[https://www.theverge.com/2018/2/27/17054740/palantir-
predict...](https://www.theverge.com/2018/2/27/17054740/palantir-predictive-
policing-tool-new-orleans-nopd)

[https://theintercept.com/2017/03/02/palantir-provides-the-
en...](https://theintercept.com/2017/03/02/palantir-provides-the-engine-for-
donald-trumps-deportation-machine/)

[https://www.businessinsider.com/palantir-took-over-from-
goog...](https://www.businessinsider.com/palantir-took-over-from-google-on-
project-maven-2019-12)

I think we are, at least in part, responsible for the behaviors of the
companies we own. Being a shareholder is not quite the same as being an LP.

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et2o
How did they have revenues of $740 million, expenses of slightly more than $1
billion, but lose $580 million?

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nikanj
Write-downs or similar

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bschne
Isn't this sort of loss at this scale usually justified, for "product"
companies, by saying they'll either run into economies of scale or drive
everyone else out of the market, thus becoming profitable eventually?

Not even considering if that rationale will work out for certain venture-
backed companies that _are_ more product-oriented, how on earth is this
supposed to work out for a consulting company like Palantir that doesn't scale
like SaaS & the likes?

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berbec
It staggers me, but losing this amount of money seems to have few negative
impacts. Is it investor fomo saying "if others put in enough cash for them to
stay afloat after losing $bajillion, they must know something I don't! Calling
my trader"?

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npv789
this is interesting

[https://techcrunch.com/2020/08/21/leaked-
palantir-s-1-shows-...](https://techcrunch.com/2020/08/21/leaked-
palantir-s-1-shows-company-has-125-customers-after-17-years/)

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npv789
bubble is coming

