IPO Archives - Serious Startups

Care.com Slips In S-1 Just In Time For Christmas

Waltham, MA-based Care.com filed its public S-1 last week, setting the 7-year-old company up to start selling shares in 2014. Following Twitter’s lead, the company will list on the New York Stock Exchange. They are looking to raise $80 million, and will be underwritten by Morgan Stanley, BofA/Merrill Lynch, and JPMorgan, among others.

For those of you without children, Care.com is a platform that connects families with potential babysitters or nannies. In the last few years, they have expanded care offerings to pet care, elderly care, and general housekeeping tasks.

There have been plenty of rumors that Care.com would file for IPO, and in November the company availed itself of new JOBS Act rules that allowed it to file confidentially. The benefit of this move is that they were able to negotiate with the SEC before opening its financials up to everyone.

And, to be honest, there’s some scrutiny to be done. The company posted $59 million in revenue in the first 9 months of this year, with a $24.7 million net loss. According to the filing, risks in the stock include a “history of cumulative losses,” the expectation of more operating losses, and an increase risk because the industry itself is evolving.

Oh, but what the hell, the tech IPO market is frothing up, so Care.com might as well jump in.

2013 ended up being a big year for tech IPOs, led of course by Twitter. By all accounts, 2014 is shaping up to be another banner year.

What’s awesome about the Care.com story, though, is that it is another perfect “everywhere else” startup story. A platform that connect sitters and families would never have been conceived out in the Valley. CEO Sheila Lirio Marcelo (yes, she’s a woman) is a Harvard Business School graduate and former EIR at Matrix Partners, which also has offices in Waltham.

The company may be operating at a loss now, but we all know that’s not uncommon for tech companies. There’s huge market potential, and so far Care.com is the most recognizable brand filling that market.

According to Crunchbase, the company has already raised $109 million in 5 rounds. An offering price and the company’s new NYSE symbol have yet to be announced.

IPO Watchlist Features 11 Startups Outside Silicon Valley

Mattermark is bringing big data to venture capital, and their free daily newsletter is one of our favorite resources.

Last week, one of the daily newsletters included a list of 25 companies the Mattermark team thinks could file an S-1 or raise a final bridge round in 2014. There were some predictable names on the list, like Box, Uber, and Pinterest.

But, there were also lots of companies from outside of Silicon Valley. Eleven, to be exact. (Okay, 10 1/2. MongoDB has headquarters in both New York and Palo Alto.) So, in a list of 25, almost half the companies expected to IPO come from somewhere other than Silicon Valley.

New York has 4 startups on the list, making it the city outside the Valley with the most expected IPOs. International companies also had a strong showing, with startups based in New Delhi, Paris, and Beijing.

It’s true that no one area has the same concentration of tech startups as Silicon Valley, but the Mattermark list proves it’s probably time to stop saying you CAN’T build a tech company everywhere else.

Here are the startups from everywhere else that made Mattermark’s watch list:

MongoDB (New York/Palo Alto)–MongoDB provides database technology to help companies take advantage of big data, cloud, mobile, and social trends.
Fancy (New York)–Fancy is a crowd-curated catalog that keeps up with new trends in merchandise, travel, and goods. You can buy right from the platform, putting it one step ahead of Pinterest.
Snapdeal (New Delhi)–Snapdeal is the largest online marketplace in India. They boast products in categories from fashion to computers to toys.
Xiaomi Tech (Beijing)–Xiaomi Tech is only 3 years old, but their smartphone outsold the Galaxy S4 in the first half of this year. They also offer internet services like MiCloud, Xiaomi App Market, and Xiaomi Games.
Outbrain (New York)–You know the “from around the web” box you see on some big publishers’ sites? That service is provided by Outbrain, a startup that helps content get discovered.
Fotolia (New York)–Fotolia is a stock photography company that offers royalty-free images for creatives and designers.
Wayfair (Boston)–Wayfair is a popular shopping site that offers all kinds of goods from your home.
AirWatch (Atlanta)–AirWatch saw the mobile revolution coming, and they now provide solutions for the mobile workforce.
JustFab (Los Angeles)–JustFab is the celebrity-backed startup that allows you access to shoes and accessories picked especially for you by professional stylists.
Deezer (Paris)–Deezer is a European music streaming and discovery service.
MuleSoft (London, Buenos Aires, Sydney)–MuleSoft connects SaaS and enterprise applications in the cloud. (One of their customers, Box, is also expected to IPO in 2014.)

We’ll be keeping an eye on these companies in the coming year, and we’ll let you know when the S-1’s get filed.

Zulily Is An IPO for Everywhere Else

There’s been a flurry of activity since Twitter filed their S-1 last week. Will it be a repeat of Facebook’s IPO? Why aren’t there any women on the board? Does that matter? And, by the way, isn’t the company still losing money?

So much digital ink has been spilled over the Twitter filing, it’s hard to remember what we wrote about before it.

Thankfully, the cycle has turned, and we have something new to write about. Two days ago another startup filed to take the IPO plunge. It’s probably safe to say that Zulily is much less well-known than Twitter and hasn’t had quite the same impact worldwide as the social media company. If you aren’t a mom, you probably haven’t heard of Zulily.

The Seattle-based flash sales site is the picture of a successful company from everywhere else. In 2009, founders Darrell Cavens and Mark Vadon saw a problem: it was difficult to buy unique, inexpensive clothes for children. If they bought clothes from Target, 20 other kids had the same shirt, but if they shelled out more money, the clothes were stained or torn in a matter of hours.

The two dads figured out a fun way to solve the problem and how much users were willing to pay for it. When all the other daily deals and flash sale sites were struggling, Zulily doubled down and continued to grow.

3 years later, they’re running a company with the coveted $1 billion valuation and filing IPO paperwork.

Twitter and Zulily have completely different business models, but thanks to filing IPOs in the same week, the comparisons are inevitable. Twitter undoubtedly has more users and more impact worldwide. However, Zulily has figured out how to get cash from their customers, which means they bring in more revenue than Twitter at the moment. Money in the bank is always, always a good thing.

Of course, that doesn’t mean Twitter is a bad company or a bad investment. Without a doubt, Twitter is changing the way information is spread, and there’s plenty to like about that. And with millions of users worldwide the potential (social media’s favorite word) for revenue is massive.

Zulily’s story is an inspiration to companies everywhere else. Not everyone can–or should want to–build the next paradigm-shifting social media company. Silicon Valley has proven particularly good at that, and the world is different because of it.

However in the next 20-30 years, entrepreneurs everywhere else will prove very good at building black ink companies that solve problems in other aspects of life. Education, healthcare, government, and logistics are all ripe for disruption, and who knows what industries will be invented in the coming decade. Big problems will be solved in hubs all over the world, as well as Silicon Valley.

A flash sales site may not solve a “big” problem, but Zulily’s IPO is more step in proving the power of everywhere else.

Indianapolis Public Startup Angie’s List Sees Stock Drop 16%

Publicly traded tech startups haven’t been doing very well lately. Groupon, and Zynga have both dropped more than 70% since their initial public offerings earlier this year. The world has been watching the public story of Facebook as well. The largest social network in the world debuted at $38 dollars a share and has since dropped 46%. Right now is a tricky time for tech startups turned public companies.

For Angie’s list, the story hasn’t been much better. Except for the fact that Angie’s list debuted much lower than Groupon, Zynga or Facebook, they’ve still seen a steady decline since going public. Tuesday, Angie’s list stock closed at $11.17, which was below their IPO price of $13. The 16% drop on Tuesday was the single biggest decline for the Indianapolis based startup since they debuted on the stock market 9 months ago.

Angie’s list is a marketplace for people to vet and find service workers. Carpenters, babysitters, plumbers and more can be found on the site. The Angie’s list community is filled with reviews from every service sector possible. Companies can’t pay to be on the list it’s all referral/review based and there are no anonymous accounts.

Angie’s list also incorporates discounts of up to 70% off from the service providers found on the site. The company was founded in 1995 by Angie Hicks and William Oesterle and has remained in Indianapolis since then.

Angie’s List reported a loss of $37 million on revenues of $68 million during the first half of 2012.

Source: Yahoo