A secretive and controversial startup may go public. Here's what you should know about it

(CNN) In the 17 years since it was founded, Palantir Technologies has received financial backing from the CIA, become one of the most valuable private companies in the US, and earned a seat at the table alongside the biggest tech companies in meeting with President Donald Trump.

But the Silicon Valley data-analytics company, which is known for taking on controversial work for the US government, has long shrouded itself in secrecy — in part, as CEO and cofounder Alex Karp recently explained in an interview with Axios on HBO, because clients often require them to keep quiet. Now, it may have to shed at least some light on its operations as the company inches closer to making a long-rumored Wall Street debut.

Palantir said this week that it confidentially filed paperwork with the US Securities and Exchange Commission to go public. As with any publicly-traded company, Palantir would need to disclose more of its financial history and open itself to investor scrutiny. And as with any tech company of its size — with a roughly $20 billion valuation — its initial public offering would likely be a high-profile event.

"If they do go down the IPO path, it would be a seminal moment in technology, very similar to the likes of Uber and Lyft that were private for many years then went public," said Daniel Ives, an analyst with Wedbush who tracks tech companies.

Named after the seeing stones in J.R.R. Tolkien's fantasy novel "The Lord of the Rings," Palantir is based in Palo Alto, California. The company has two products that customers use to organize and glean insights from mounds of data: Gotham, which was initially developed for government clients, and Foundry. Any data contained in SEC filings yet to be released publicly would almost certainly reveal more.

With Palantir's IPO, there's more at stake than investor returns. Some hope an IPO would lead to greater transparency, like Jacinta Gonzalez, senior campaign organizer of organizing group Mijente, which has long been critical of Palantir for its work with US Immigration and Customs Enforcement, and its ties to the Trump administration. But she's also worried that a successful IPO will show more companies that policing is good for business.

Palantir spokeswoman Lisa Gordon declined to comment for this story, citing the quiet period Palantir entered as it began the IPO process.

A history of bold claims—and controversial work

Cofounded in 2003 by Peter Thiel, a member of the so-called "PayPal mafia" and a longtime Facebook board member known for supporting Trump's 2016 campaign, Palantir's stated mission is to "make the West, especially America, the strongest in the world." The company touts its ability to manage and secure data at a massive scale.

Palantir provides governments and corporations with tools to help with everything from tracking the spread of the novel coronavirus to zeroing in on terrorists. It even reportedly helped track down Osama bin Laden.

Yet it has historically been quiet about the precise ways in which its services are used, which has earned the company a shadowy reputation. What's clear is that maintaining a relationship with the government has been key to the company for much of its history.

In its early years, Palantir struggled to get investors and clients, before raising money from the CIA's investment arm, In-Q-Tel, as well as from Thiel and his VC firm Founders Fund. Since then, the company has taken on work with the US government that others in Silicon Valley might not have been comfortable with.

In 2017, CNN reported that Palantir had helped the Los Angeles Police Department analyze data, ranging from license plates photos to rap sheets, traffic tickets, listings of foreclosed properties and more. While this can make it easier for police to do things like track down criminals, it also indicates how technology such as Palantir's offers law enforcement unprecedented surveillance capabilities.

More recently, Karp said in an interview with CNBC at Davos in January that Palantir has been assisting with finding undocumented immigrants for deportation — something that had long been rumored but unconfirmed.

"We take what amounts to strong but often controversial positions," Karp said at the time.

And in May, Karp acknowledged in an interview with Axios on HBO that Palantir's technology "is used on occasion to kill people." He made clear that it can be used for targeting of all kinds, including people. "If you're looking for a terrorist in the world now you're probably using our government product and you're probably doing the operation that actually takes out the person in another product we built," he said, most likely referring to Gotham and Foundry, respectively.

At a time when companies such as Amazon and Microsoft said they have halted the sale of some contested technology — namely facial-recognition systems — to US police departments, Palantir is "sort of the opposite," said Evan Greer, deputy director at digital rights nonprofit Fight for the Future.

"I think companies like Palantir are allowing governments and institutions to weaponize our data and use it in ways that oppress people rather than lift them up," Greer said.

The contrarian may cash in again

Just as Palantir is among the most controversial companies in Silicon Valley, so is its most famous cofounder.

Thiel is known for being a contrarian. Thiel, a Stanford University graduate, funds a fellowship that offers young entrepreneurs $100,000 to spend two years building a company rather than attending college. He has argued that monopolies are good and coauthored a book in 1995 called "The Diversity Myth," criticizing the "debilitating impact" of "politically correct multiculturalism" on college education.

He was also discovered to be bankrolling the lawsuit of Terry Bollea, popularly known as the wrestler Hulk Hogan, against Gawker Media that forced the publisher into bankruptcy. Yet he has also donated to the Committee to Protect Journalists.

"It's precisely because I respect journalists that I do not believe they are endangered by fighting back against Gawker," he said in a 2016 interview, as part of his explanation for why he didn't think the two activities contradicted each other.

A libertarian, he served as a surrogate for Donald Trump's 2016 campaign, going against many powerful tech CEOs and criticizing Silicon Valley in the process.

Thiel, who has invested at least $40 million in Palantir, has defended the company's role despite his previously articulated anti-government approach. "The government was collecting a lot of data [in the war on terrorism], more than they could analyze," he told Fortune in March 2016. "If we could help them make sense of data, they could end indiscriminate surveillance."

Unlike PayPal, which was inspired by the idea of creating a currency "free from all government control and dilution," Palantir is helping empower government agencies: it scored $1.5 billion in new contracts with the US government in 2019 alone.

But Palantir may have at least one thing in common with PayPal: it will likely make Thiel a lot of money.