As a Netsuite customer and consultant, I’m surprised that I’ve never heard talk of Netsuite’s IPO plans. In all the usergroup posts and official Netsuite notifications, nothing has ever been mentioned, which strikes me as strange. Maybe it’s not, who knows.
At any rate, it seems like more than a possibility at this point. A few quotes from some articles I found:
The San Mateo hosted software firm plans to file IPO papers with the Securities and Exchange Commission in the second half of 2006, when the company expects to reach profitability.
The company’s head count grew from 300 to 450 in the last year, including adding a new worldwide marketing director and product marketing director. Nelson hopes to employ 500 by year’s end. CFO McGeever said the company’s biggest hurdle to growth is hiring and training enough professional services staffers to help Netsuite’s 7,000 customers implement its software.
We’ll all know a lot more when NetSuite actually files its registration statement. Clearly, if they are on pace to double revenues and reach profitability, the company seems well positioned to have a successful IPO particularly given the rabid appetite for SaaS plays. However, expecting NetSuite to be afforded a valuation similar to that of salesforce.com may be a tad aggressive.
An interesting take on Netsuite’s prospects
I think for a while there was some debate about whether Oracle would snap up Netsuite, but I think it stands to do pretty well on its own in the market, especially considering how hot SaaS (Software as a service) is for investors. Netsuite is rumored to be expecting twice its 40M in sales from 2005 in this year, and to become profitable. Add in an IPO and a near doubling in headcount, and that’s a big year for a young company.
As a customer I’m mostly concerned about how they handle their growth – I’ve worked with a lot of businesses as a consultant and seen many that couldn’t handle the transition from one order of magnitude to the next. I’ve always believed that it was the talent of the employees that makes the biggest difference to a company, and hiring great people is a big challenge. I love reading about the hiring practices about the world’s most progressive companys – first it was Microsoft and their famous day-long interviews, and now Google has gleaned a rep for picking talent.
I think the only safe bet is that it’ll be an interesting year for anyone following Netsuite’s story.
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