Who Owns Sprout Social Company?

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Who Owns Sprout Social?

Understanding a company's ownership is key to grasping its direction and accountability. Sprout Social, founded in 2010, transitioned to public ownership via its IPO in December 2019 on the Nasdaq Global Market under the symbol 'SPT'.

This public offering marked a significant shift from its private, venture-backed beginnings, opening its shares to a broader investor base and influencing its corporate governance.

As of early 2025, Sprout Social is a prominent player in social media management, serving around 30,000 brands globally. The company reported substantial growth, with Q1 2025 revenue reaching $109.3 million, a 13% increase year-over-year. Its subscription revenue also saw a 13% rise, totaling $108.7 million in the same quarter. The company's market capitalization was approximately $1.12 billion as of July 24, 2025. This analysis explores how its ownership has evolved, from initial founder stakes to its current mix of institutional and public shareholders, impacting its strategic path and Sprout Social BCG Matrix.

Sprout Social, Inc. was established in April 2010 by a group of four founders: Justyn Howard, Aaron Rankin, Gil Lara, and Peter Soung. These individuals laid the groundwork for the company, with Howard serving as Co-Founder and Executive Chair, and Rankin as Co-Founder and Director. Lara is recognized as a Co-Founder and Chief Creative Officer, while Soung is also a founder and board member.

Founding Team

Sprout Social was founded in April 2010 by Justyn Howard, Aaron Rankin, Gil Lara, and Peter Soung. Howard is the Executive Chair, Rankin is a Director, and Lara is the Chief Creative Officer.

Early Investment

The company received its first funding of $1 million in 2010, led by Lightbank. This initial backing set the stage for further growth and investment rounds.

Venture Capital Backing

In February 2011, Sprout Social secured $10 million in Series B funding from New Enterprise Associates (NEA). Subsequent rounds included $42 million in Series C funding, with participation from Goldman Sachs Investment Partners and NEA.

Total Funding Raised

By December 2018, Sprout Social had amassed a total of $102 million across six funding rounds. The Series D round alone brought in $40.5 million, with Future Fund leading the investment.

Dual-Class Share Structure

A dual-class share structure was implemented, giving Class B founder shares ten times the voting power of Class A shares. This ensured significant control for the founding team.

Post-IPO Voting Power

Following its IPO in December 2019, the co-founders collectively held approximately 72.9% of the voting power through their Class B shares, underscoring their continued control over the company.

The ownership structure of Sprout Social is significantly influenced by its dual-class share system, which was in place prior to its public offering. This structure was designed to maintain control with the founders, even as the company attracted substantial investment from venture capital firms like New Enterprise Associates and Goldman Sachs. The early funding rounds, totaling $102 million by late 2018, were crucial for the company's expansion and development, allowing it to compete effectively in the social media management space, as detailed in the Competitors Landscape of Sprout Social. The concentration of voting power in the hands of the founders, particularly Justyn Howard and Aaron Rankin, who held substantial portions of the Class B shares, ensured their continued influence on the company's strategic direction after its IPO in December 2019.

Sprout Social Ownership Details

Sprout Social's ownership is characterized by a dual-class share structure that grants founders enhanced voting rights. This structure has been instrumental in maintaining founder control since the company's inception.

• Founders Justyn Howard, Aaron Rankin, Gil Lara, and Peter Soung established the company in April 2010.
• Early funding included a $1 million round in 2010 led by Lightbank.
• By December 2018, the company had raised $102 million across six funding rounds.
• Post-IPO, founders collectively held approximately 72.9% of the voting power through Class B shares.

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Sprout Social's ownership landscape significantly shifted with its Initial Public Offering (IPO) on December 13, 2019, marking its debut on the Nasdaq Global Market. This event transitioned the company from private to public ownership, impacting its shareholder base and governance structure.

Following its IPO, Sprout Social implemented a dual-class share structure. This structure designates Class A common stock with one vote per share and Class B common stock with ten votes per share. The co-founders exclusively hold the Class B shares, which grants them substantial voting power, approximately 72.9% of the total voting power of the company's outstanding capital stock after the IPO. This arrangement ensures that the founders maintain significant control over the company's strategic direction.

Major Sprout Social Investors

As of March 31, 2025, Sprout Social has a broad institutional ownership base. These entities collectively hold a significant portion of the company's shares, indicating broad market confidence.

• Vanguard Group Inc. holds 5,900,938 shares.
• Cadian Capital Management, Lp holds 5,061,146 shares.
• BlackRock, Inc. holds 4,128,856 shares.
• ArrowMark Colorado Holdings LLC holds 3,367,093 shares.
• Baillie Gifford & Co holds 3,023,523 shares.
• Wellington Management Group Llp holds 2,829,877 shares.

The company's financial performance in 2024 demonstrated robust growth, with revenue reaching $405.91 million, a 21.66% increase year-over-year, although it reported losses of -$61.97 million. For the first quarter of 2025, Sprout Social reported total revenue of $109.3 million, reflecting a 13% increase compared to the same period in the previous year. Understanding the Sprout Social ownership structure provides insight into its governance and the influence of its founders and major investors. For a deeper dive into the company's journey, explore its Brief History of Sprout Social.

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Sprout Social's governance is overseen by a board of directors that includes key figures from its founding team and independent industry experts. The board's composition aims to balance strategic direction with robust oversight, ensuring alignment with stakeholder interests.

The voting power within Sprout Social is significantly influenced by its dual-class share structure. Class A common stock carries one vote per share, while Class B common stock, held exclusively by the co-founders, is granted ten votes per share. This structure was put in place in 2019 and includes a seven-year sunset clause, meaning the enhanced voting rights of Class B shares are scheduled to convert to a one-vote-per-share basis in 2026. This arrangement ensures that the founders retain considerable control over corporate decisions, including board elections and significant transactions. Post-IPO, the co-founders collectively held approximately 72.9% of the total voting power.

Understanding Sprout Social's Ownership Structure

Sprout Social's ownership is characterized by a dual-class share system that concentrates voting power with its founders. This structure is key to understanding who controls the company's direction.

• Co-founders hold Class B shares with 10 votes per share.
• Class A shares have 1 vote per share.
• A sunset clause in 2026 will equalize voting rights.
• This structure impacts Sprout Social ownership significantly.
• It's important to understand these details for Sprout Social investors.

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Sprout Social has seen significant shifts in its leadership and ownership landscape over the past few years. A key development is the upcoming CEO transition, with Ryan Barretto set to take the helm in October 2024, while co-founder Justyn Howard moves to an Executive Chair role.

The company's financial performance indicates continued growth, with a projected revenue range of $448.9 million to $453.9 million for the full year 2025. This follows a Q1 2025 revenue of $109.3 million, representing a 13% year-over-year increase. The focus on expanding its customer base is evident, with a 6% year-over-year growth in customers contributing over $10,000 in Annual Recurring Revenue (ARR) and a 22% growth in those contributing over $50,000 in ARR during Q1 2025.

Leadership Evolution

A significant leadership change is underway with Ryan Barretto stepping into the CEO role in October 2024. This transition marks a new chapter for the company's executive management.

Strategic Acquisition

The acquisition of NewsWhip in July 2025 bolsters the company's AI capabilities in media intelligence. This move is expected to accelerate its predictive analytics roadmap.

Institutional Investor Dominance

Institutional investors hold a substantial majority of the company's shares, indicating significant backing from financial institutions. Their investment activity, including both additions and reductions in holdings, reflects ongoing market sentiment.

Market Performance and Outlook

Despite recent share price declines, the company projects robust revenue growth for 2025. The expansion of high-value customer segments underscores a positive underlying business trend, aligning with insights into the Target Market of Sprout Social.

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