San-Francisco, CA-based company startup AppDynamics finally commenced its Initial Public Offering (IPO) process. The application performance monitoring and management solutions company filed the mandatory S-1 form with the Securities and Exchange Commission (SEC) last week. AppDynamics, which provides real-time business and application performance management technology to Salesforce and IBM, is aiming to raise $100 million through US IPO.
As per the S-1 filing guidelines, AppDynamics will be listed on NASDAQ under the symbol “AAPD”. It is, however, unclear as to how many shares and the price of each share the company is offering. Currently, AppDynamics has revenues less than $1 billion and thus falls under the purview of JOBS Act. It means that the company will have certain incentives and exemptions on IPO allowing equity crowdfunding.
AppDynamics has managed to raise close to $315 million in the last nine years since its inception. However, a tech unicorn going public highlights the cut-throat competition and the impact of growing losses on novel innovators. Backed by a strong revenue growth over the last couple of years, AppDynamics IPO was always around the corner.
Today, AppDynamics publicly filed its S-1 with the SEC for its planned IPO. Find important information here: https://t.co/tQhZJud6ZF
— David Wadhwani (@dwadhwani) December 28, 2016
CEO David Wadhwani opted for AppDynamics IPO based on the positive net promoter score by its customers. Back in November 2016, it was speculated that AppDynamics IPO filings would be finalized in 2017 following the unexpected results of 2016 US Presidential elections. Then, it was expected to fetch anywhere between $2 billion and $3 billion. Surprisingly, the “Application IQ” platform has slashed its IPO expectations to $1 billion despite registering revenue of $158.4 million in January-October 2016. In November 2015, the company was valued at $1.9 billion in a private financing round arranged by General Atlantic and other investors.
According to the insiders, lead underwriters handling the critical IPO for App Dynamics are Morgan Stanley, Goldman, Sachs & Co., and J.P. Morgan. Wells Fargo Securities, UBS Investment Bank, Barclays, JMP Securities, and William Blair would also feature in the list of IPO underwriters.
In 2016, only 11 tech unicorns went public, raising $1.2 billion. Overall US IPO market has been sluggish in 2016. Only 125 companies filed for IPO compared to 234 in 2015.
With a $100 million price tag on its badge and backed by leading investors like Lightspeed Venture Partners, Greylock Partners, General Atlantic, Altimeter Capital, and Battery Ventures, AppDynamics is expected to start trading on NASDAQ very soon. App Dynamics IPO may just have ushered a new wave of funding in 2017.