Canonical, the company that funds the development of Ubuntu, is likely to go public through an Initial Public Offering (IPO) in 2023.
Canonical founder and CEO Mark Shuttleworth, the company behind the widespread Linux distribution Ubuntu, revealed in an interview for the popular news tech media TechCrunch in April that it is considering going public through an Initial Public Offering (IPO) in 2023. This news has generated buzz within the Ubuntu community, as many wonder what this move could mean for the operating system’s future and its users.
We are on track to float the business. And now I’m pretty confident that we will do that in 2023.Mark Shuttleworth, Canonical founder and CEO; Source: TechCrunch
2023 is already here, and if this plan comes to fruition, it will impact Ubuntu’s focus and future development in some way. So, let’s analyze the likely ramifications.
First, we need to answer the question: why does a company opt to go public? Whether a company is brand new or has been in operation for years, it may decide to go public via an IPO. However, in the mainstream case, companies seeking to expand often use an Initial Public Offering to generate funds via access to capital markets. So, the most significant benefit of an IPO is the additional funds raised.
Furthermore, when a company moves to IPO, it sells shares to the public. I.e., it is a capital raise event. So, it is much easier to raise money once publicly traded. Also easier to attract employees by paying higher salaries with out-of-thin-air-newly-issued shares when public.
In other words, ideally, an IPO would allow Canonical to raise funds through the sale of company shares, potentially leading to more money and human capital being invested in the development of Ubuntu.
However, on the other hand, switching to the IPO model always involves changes in the company’s vision and direction. In this regard, it is also essential to consider how this move could affect the open-source nature of Ubuntu and the community-driven development model. So let’s see how this affects the average Ubuntu user.
What Impact Would Canonical’s IPO Have On Ubuntu Users?
In the most straightforward words, the main goal of any business organization is to generate income. And, of course, this is perfectly normal. However, when discussing Open Source, there is always a subtle nuance: how would the community accept a move to IPO? How would it reflect on the existing followers, which in the case of Ubuntu are millions, i.e., the average home user of this operating system, a similar move?
However, don’t get the impression that this is uncharacteristic of Open Source. Companies such as Red Hat and SUSE have been transitioning to the IPO model for over a decade, and we can see that it has been effective, particularly in the case of Red Hat. However, the main concern with the IPO is a shift in the company’s focus.
Specifically, once a company goes public, the focus shifts to ensuring the financial well-being of the shareholders rather than satisfying expectations and listening to the voice of users who are simply consuming the final product offered to them for free – in this case, Ubuntu.
If Mark Shuttleworth follows through on his intention for Canonical to transition to the IPO model, I doubt anyone will be surprised. In recent years, Ubuntu has increasingly drifted away from its initial slogan, “Linux for human beings,” mainly focusing on the business user segment that generates revenue for the company.
Of course, this has predictably resulted in a retreat of end-users who felt that their opinions, feedback, and commitment to the open-source philosophy of community had been lost somewhere in Ubuntu’s past. The latest Ubuntu releases eloquently prove this.
Controversial decisions to integrate into its releases technologies that are not widely accepted by the Linux community, the unthinkable insertion of just one or two lines advertisement (I know, it is not a big deal) promoting a completely free service, and so on. Unfortunately, actions demonstrate an autocratic approach and a refusal to listen to the community’s voice.
The overwhelming impression is that, unlike ten years ago, when the focus was on Ubuntu providing the perfect desktop for the average Linux user, things are now entirely flipped. The desktop versions of Ubuntu are simply new releases, but the emphasis has shifted to the server side (where the big business customers are) and the technologies it can serve.
So, Canonical’s eventual transition to the IPO in 2023 would only intensify this process and widen the chasm between Ubuntu and the average Linux user due to the pursuit of better market performance and dividend yield for shareholders.
This is the typical event sequence. It’s part of growing up. However, there will always be Debian and Linux Mint, unconstrained by corporate interests, for the next wave of frustrated Ubuntu users disagreeing with the course taken to return to.