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Posts Tagged ‘tech ipo’

Tech IPOs filed so far have shades of dot-com bubble

Posted in Uncategorized, tagged , , , , , , , , on December 15, 2009| Leave a Comment »

Here is some IPO news from Marketwatch.

After recent optimistic comments about an upcoming rebound in technology initial public offerings by several Silicon Valley venture capitalists and investment bankers, I decided to see if the reality lived up to the hype — and hope — and trolled through several regulatory filings to see what technology companies are in the queue to go public.

Last week, wheeler dealers at the Venture Summit Silicon Valley conference said there were a slew of technology companies working on S1 filings, the core regulatory document for an IPO. At least 50 venture-backed companies could seek to go public next year, possibly as high as 100, dealmakers said. See column on venture capitalists’ optimism here.

“It’s certainly going to start a lot more robust than 2009, which was completely dead,” said Scott Sweet, senior managing partner of the IPO Boutique. “The last three months of 2009, though, have been quite busy.”

Currently, though, it’s a rather motley crew of tech companies that have filed S1s to go public, and nothing yet that might have the buzz — or shall we say hype — of some of the widely-anticipated Silicon Valley names like Facebook, Zynga, or Tesla Motors.

That said, many look to be solid citizens, with revenue growth and earnings, but some firms are still losing money, not exactly an example of the new, improved IPO. Sweet said two tech IPO names that have the most chatter in this batch are Calix Networks Inc. and Fabrinet, both of which were founded during — and survived — the dot-com bubble and bust.

Calix Networks develops broadband access equipment for network service providers. Revenue jumped in 2008 to $250.5 million, up from $193.8 million in 2007. It’s still losing money and lost $17 million in 2008, an improvement from its loss of $26 million in 2007. Founded during the boom in August, 1999, Calix is based in Petaluma, Calif., a farming area north of San Francisco, dubbed Telecom Valley, a once fertile area for telecom startups as well. Earlier this year, it raised $100 million in additional venture.

Fabrinet was also founded in August 1999 and started operating in January 2000. Its corporate headquarters are in the Cayman Islands. It offers contract manufacturing services for developers of optical communications components, one of the most-hyped hardware areas of the late ’90s. Fabrinet designs and makes products like application-specific crystals, prisms, mirrors and laser components for six of the ten largest optical communications components companies worldwide.”

Read the full article here.

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Lean times continue for startups, as sales, IPOs wither

Posted in Board Of Intellectual Capital, Business models, Economy, Gerbsman Partners, Investments, Strategy, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , , , , , , , , , on July 8, 2009| Leave a Comment »

Here is an excellent Bloomberg article by way of statesman.com.

“SAN FRANCISCO — Acquisitions of startups fell to the lowest level in a decade in the second quarter as the recession stopped companies from buying smaller competitors.

A total of 59 startups merged with other companies, a drop of 30 percent from a year earlier and dropping to the lowest level since 1999, the National Venture Capital Association said. Five U.S. startups have had initial public offerings so far this year. In 2007, before the financial crisis, there were 86.

Acquisitions and IPOs — the two ways for venture capitalists to cash in their investments — have almost come to a standstill, NVCA President Mark Heesen said. With the IPO market struggling, larger technology companies — confident that prices will fall — are waiting before proposing takeovers, he said.

“The buyers on the merger and acquisition side got smart real fast,” Heesen said. “They wait for companies to come crying to them to get bought.”

No venture-backed companies went public between September and March — the longest slump since the association began collecting data in 1971. Only 11 startups have had IPOs since the end of 2007, and there is little immediate prospect for improvement, said Paul Bard, an analyst at Renaissance Capital.

Only 10 startups have filed pre-IPO paperwork with U.S. regulators, and none has done so since January, said Emily Mendell, an NVCA vice president. That signals that deals such as the May IPOs of Austin-based SolarWinds Inc. and online restaurant-reservation service OpenTable Inc. failed to spur other young companies to act.

It also means the market won’t revive in the next few months, Bard said.

“Unless filing activity spikes in the next two to three weeks, we’re unlikely to see a more sustainable pickup in VC-backed IPOs before Labor Day,” Bard said. “The bar will remain high for most VC-backed deals to get done.”

Even if the 10 biggest venture capitalists had 25 companies ready to go public by early next year, that would still leave IPOs at about a third of their levels from 2004 to 2007, he said.

That means startups lack bargaining power in merger talks, a situation that is keeping offers low and stalling many negotiations that do occur, Heesen said.

Only 13 of the 59 companies that sold out reported how much they were paid, the association said. Prices were higher than in the first quarter, a possible sign of improving conditions later this year, it said.

Cisco Systems Inc.’s $590 million deal to buy Pure Digital Technologies Inc., maker of the Flip Video camera, helped drive up the average merger price to $197.7 million.

Five companies commanded less than venture capitalists had invested, the venture capital association said. Purchases of medical-instrument makers CoreValve Inc. and Chestnut Medical Technologies Inc. were the only ones in which early backers received 10 times their outlay, the traditional standard for a venture-capitalist home run, Mendell said.”

Read the full article here.

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Facebook Names Genentech Veteran as CFO – IPO plans may be looming

Posted in Board Of Intellectual Capital, Business models, FaceBook, Investments, Market research, Social Networks, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , on June 30, 2009| Leave a Comment »

As Facebook secured some investments earlier this year, and invested it towards international growth, the latest news spark renewed IPO rumors.

Of course, no one knows, but the hiring of a CFO from a larger corporation is nothing you do unless you have greater plans. First and foremost, it costs you a bunch of money, secondly, the demands this person has on you by his experience will force the structure needed upon you.

The biggest challenge remains though – to create profitability.

Here is a quoted article from BusinessWeek.

“In April, when Facebook announced the departure of Chief Financial Officer Gideon Yu, the social network said it would look for a replacement “with public company experience.” Facebook found what it was seeking in David Ebersman, a 15-year veteran of biotech pioneer Genentech (DNA).

“David [Ebersman] worked at one of the most innovative and respected [companies] in the world, so he brings a lot to the table when it comes to our efforts to build a lasting, important company,” Facebook spokesman Larry Yu says of the appointment, announced on June 29.

Ebersman’s appointment keeps alive speculation over whether and how soon the world’s biggest social network is headed for an initial public share sale. “We have no plans to go public,” says spokesman Larry Yu. Facebook CEO Mark Zuckerberg was quoted in May saying an IPO remains “a few years out.”

Ebersman, 38, served as Genentech’s CFO for the four years leading up to its $46.8 billion sale to drug giant Roche Holding (ROG) in May. In Facebook’s press release, CEO Mark Zuckerberg noted that under Ebersman, Genentech’s revenue tripled. Zuckerberg envisions high growth for his company as well, saying sales will rise 70% this year. (eMarketer has projected that Facebook’s revenue will grow 20% this year, to $300 million.)”

Read the full article here.

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