US tech firm Palantir, known for supplying controversial data-sifting software to government agencies, has fetched a market value of nearly $22bn (£17bn) in its debut on the New York Stock Exchange.
It's a lofty figure for a firm that has never turned a profit, been hit by privacy concerns and relies on public agencies for nearly half of its business.
But the company, which takes its name from the "seeing stones" known for their power and potential to corrupt in Lord of the Rings, says the need for the kind of software it sells "has never been greater".
The firm, which launched in 2003 with backing from right-wing libertarian tech investor Peter Thiel and America's Central Intelligence Agency (CIA), builds programs that integrate massive data sets and spit out connections and patterns in user-friendly formats.
The firm - sometimes described as the "scariest" of America's tech giants - got its start working with US soldiers in Iraq and Afghanistan, but now supplies software to police departments, other public agencies and corporate clients.
It is active in more than 150 countries, including the UK, where it was one of the tech firms the government enlisted this spring to help respond to coronavirus.
In the first half of 2020, Palantir revenue rose 49% year-on-year, topping $480m (£373m). And at its direct listing on Wednesday, in which investors sold some of their existing shares to the public, shares opened at $10 each - above the $7.25 reference price - giving it a value of roughly $22bn.
Mark Cash, equity research analyst at Morningstar, who has estimated the firm's value at $28bn - even higher than the valuation reached on Wednesday - said the firm is well-positioned in a growing industry.
"Data integration at this scale for the government is very complex and I think if you tried to stop spending on that and it just goes away, you're going to have some big problems," he said. "We think it's very hard to switch away from once you're in as a customer."
ICE and privacy protests
But Palantir's rise has been shadowed by concerns from privacy experts, who say the firm's tools enable surveillance and analysis of data - everything from drivers licenses and social media posts to DNA swabs - that skirts people's right to privacy and is ripe for abuse.
In the US, the use of its technology by immigration authorities to help round up undocumented immigrants has drawn heated protests and in the UK, the health data handled by the firm has also raised alarms.
Ahead of the firm's listing, Amnesty International issued a report saying the firm was failing its responsibility as a company to protect human rights with inadequate due diligence into who it is working for.
"We have to move away from the idea that data analytics and data collection is objective or clean or immune from all the pathologies that we're seeing play out right now," said Paromita Shah, executive director at Just Futures Law, which focuses on immigration law.
"Our governments are the problem because they don't want to set up oversight, but Palantir takes advantage of it."
'We have chosen sides'
Palantir told Amnesty that it had deliberately declined some work with border authorities in the US due to the concerns.
But the company has also vigorously defended its government work, maintaining that its clients own and control the data. It says it has a team focused on civil liberties issues, but it is the government's job to craft policy, not Silicon Valley's.
It has contrasted its commitment to some other tech firms, such as Google, which stopped work on an artificial intelligence project with the Pentagon after a backlash from employees.
"Our company was founded in Silicon Valley. But we seem to share fewer and fewer of the technology sector's values and commitments," chief executive Alex Karp wrote in the filing announcing its plans to sell shares to the public. "We have chosen sides, and we know that our partners value our commitment."
The outspoken defence is perhaps little surprise, coming from a firm co-founded by Mr Thiel, who famously abandoned Silicon Valley in 2018, decrying its liberal politics.
Mr Thiel, whose estimated $2.1bn fortune was fuelled by the sale of PayPal and an early investment in Facebook, funded the Hulk Hogan invasion of privacy case that bankrupted gossip news site Gawker and has given generously to conservative politicians.
In 2016, he donated more than $1m to US President Donald Trump, though he is reportedly sitting out this election cycle.
By contrast, chief executive Alex Karp, who met Mr Thiel when they both attended Stanford Law School, is a self-described neo-Marxist and "card-carrying progressive", with a doctorate degree in neo-classical social theory from a Goethe University in Germany.
He displays Tai Chi swords in his offices, according to Bloomberg, and the firm's presentation to investors this month opened with a video of him racing up a hill in orange exercise gear.
Prospective investors have to be "comfortable" with the firm's leaders - especially since, under the terms of the listing, they will continue to wield outsize voting power over the firm, even after ownership shifts to the public, said Mark Moerdler, senior research analyst at Bernstein Research.
His team also warned in a recent note that the controversies could hurt the firm's efforts to win private-sector clients.
"Politics has entered business in a way we haven't seen before and you see large companies being influenced by employees and others in interesting ways," Mr Moerdler told the BBC. But, he added, "I don't think it will fundamentally impact their ability to grow the business if the opportunities are as large as they believe they are."
Palantir may be an American company, but it actually employs more people in London - just shy of 600 - than in either its Silicon Valley base or Denver headquarters.
That reflects both the work it does for European clients including BP, Airbus and Ferrari - but also its UK government contracts, which predate the coronavirus pandemic by several years.
These - a source told me - have included work with GCHQ's cyber-spies as well as publicly declared work for the Ministry of Defence.
Big data analytics may sound like a dry subject, but speak to the firm's staff and they can speak passionately about a job that they say has involved helping fight drug cartels, catch child predators and prevent terrorist attacks.
But while Palantir might like to highlight the lives it helps save, it has also been accused of having "blood on its hands" by civil rights protesters. They object to its tech being used to identify places where illegal immigrants are working so the properties can be raided and those arrested deported.
In fact, the firm has effectively become the bogeyman of surveillance tech.
Shareholders will have to be aware that while many states and companies see benefit from using its software, there are also many with an interest in exposing any further controversies it might be involved in.
Palantir financial prospects
Just how big those opportunities are remains an open question.
While its efforts to make inroads in the corporate world were rocky initially, Palantir's commercial business has grown. It now accounts for 53% of revenue and includes customers such as French plane maker Airbus and energy giant BP.
And Palantir has said it is well-poised to continue to win government work, thanks to a lawsuit it won against the US military in 2016, which requires the government to consider commercially available products first.
The firm's finances have also improved in recent years, amid pressure from early backers to list shares publicly and allow them to cash out.
In 2019, the firm brought in $743m in revenue, up 25% from the year before, with some 60% of sales from outside the US.
But Palantir still posted a loss of nearly $580m last year and relies on a relatively small number of clients for the majority of its revenue.
Its nearly $22bn opening valuation was only a bit higher than the $20bn private investors valued the firm when it fundraised five years ago.
And as Palantir starts to trade publicly, scrutiny has only grown. This month, liberal US politicians, including Rep Alexandria Ocasio-Cortez, asked financial regulators to investigate the firm, saying the information it had provided to investors lacked transparency on key areas of risk, including data protection and work with foreign governments.
Growth will depend on landing new, large deals every year while retaining their profitable clients - and the firm hasn't shared much about its record, said Mr Moerdler.
"If they can make the product critical to an organisation, it can be sticky, but the road there is long," he said. "In terms of growing, it still needs to be proven."