Tech IPOs Kick Into High Gear
Technology IPOs haven't been waiting for Google.
A few months ago, many investors were hoping that Google Inc., the popular search engine, would reignite interest in initial public offerings. The thinking went that the tech IPO market, which had waned following the dot-com bust, needed a name-brand deal such as Google's to jolt it back from the dead. Google is expected to announce plans to push forward with an IPO this week, but the tech IPO market already has surged back to life without its help.
Eleven U.S. technology companies have gone public this year, up from none in the same period a year ago, according to Thomson Financial. And the rush is just beginning. Since March 1, 22 tech concerns have filed to go public; that is more than in the preceding four months combined. The 13 tech companies that filed for an IPO in March were the most in one month since October 2000, when there were 23 filings. Among the companies now waiting to go public: online jeweler Blue Nile Inc.; antispam-software maker Brightmail Inc.; online software maker salesforce.com Inc.; and Linux firm Lindows Inc.
"Compared with a few years ago, there's clearly significant activity in tech IPOs right now, and that should stretch into a really active fall period for IPOs," says Tom Taulli, co-manager of the $10 million Oceanus Value Fund, who closely tracks new offerings.
Driving the revival are tech companies seeking access to public capital, as well as cash-rich investors looking for new investments. IPOs provide a healthy stream of fees for investment banks. Furthermore, venture capitalists are looking to IPOs again as a way to recover long-held investments in private companies. "There's been a lot of inventory on the venture side [that needs to go public], so many of us have been waiting for the market to awaken," says Steve Domenick, a venture capitalist at Sevin Rosen Funds in Palo Alto, Calif.
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With this backdrop, waiting for the Google IPO just didn't make sense, say some tech companies. Some feared Google, which is expected to be one of the hottest IPOs in a decade, would capture the attention -- and cash -- of investors. James Walker, chief financial officer of educational-device maker AlphaSmart Inc., which listed its stock publicly in March, said his Los Gatos, Calif., company purposely wanted to get into the market before Google did. "We're just a small-cap, and we didn't want to get lost in the shuffle," he says.
But investors beware: Many of the firms seeking IPOs have scant revenues and big losses, echoing the worst excesses of the tech-IPO boom. Lindows, which adapts the free Linux operating system for personal computers, recorded $2 million in revenue last year but posted a loss of $4 million. Its auditors recently questioned its ability to continue as a going concern, absent additional investments. Wireless-software maker Seven Networks Inc., which filed to go public in late March, lost $12.9 million in 2003, on revenue of $6.9 million. And nanotechnology concern Nanosys Inc., which filed to go public last week, had revenue of $3 million and a loss of $9.2 million last year.
Officials at Lindows, Seven Networks and Nanosys declined to comment, citing the quiet period before their IPO.
These companies are still more solid than some of the dot-coms that went public with little more than a business plan in the late 1990s, says David Liu, senior vice president of investment bank Broadview International, a division of Jefferies Group. But he says that companies in "hot" sectors -- such as specialty semiconductors, online advertising and Chinese Internet companies -- are trying to capitalize on investor interest to go public despite poor financials.
As a result, Mr. Liu believes many of the tech companies that are waiting to go public now won't succeed. "I'm just not sure how many of those will get done," he says.
Chad Keck, co-head of corporate finance at investment bank Needham & Co., says he has told clients they need to be profitable and have quarterly revenue of $20 million to go public. But as investor appetite for IPOs has increased this year, that is changing. "More people seem to be accepting the speculative and early stage IPO, which is troubling," he says.
A successful Google IPO could generate a lot of copycat deals from companies that aren't as profitable as Google, says Rich Peterson, chief market strategist at Thomson Financial. "Things like profitability and revenue become secondary in whatever is the hot industry," he says.
Indeed, some unprofitable tech concerns with few prospects for immediate revenue growth have recently managed to go public. In early February, for example, solar-technology firm DayStar Technologies Inc. listed its shares on the Nasdaq Stock Market, raising $10.5 million. The Grass Valley, Calif., company, which has eight employees, was able to go public even though it had revenue of just $72,000 in the nine months ended Sept. 30, 2003, and a loss of about $810,000 during the same period. DayStar's main product, a thin film solar cell, won't be out until mid-2005.
Kelly McCarthy, DayStar's vice president of investor relations, says many investors had asked the company if it was jumping the gun by going public. But Ms. McCarthy says its listing was "perfect timing," because it was offering investors the chance to "invest in an early stage technology company at the forefront of the renewable-energy industry."
DayStar shares began trading on the Nasdaq Small-Cap Market in late March at around $2.40. In 4 p.m. trading yesterday on the Nasdaq Stock Market, DayStar shares fell 4.5% to $3.40 each. The rising share price puts DayStar in the minority among recent IPOs. Six of the 10 tech firms that went public in the first quarter are now trading below their offering price, says Thomson Financial's Mr. Peterson.
Some of the newly listed companies are profitable, including AlphaSmart. In its first quarterly financial results as a public company earlier this month, AlphaSmart posted net income of $63,000, with revenue of $8.8 million, up from $8.3 million in the same period a year ago. AlphaSmart sold shares in February at $6. In 4 p.m. trading yesterday on the Nasdaq, AlphaSmart shares fell 2.8% to $5.20.
Meanwhile, SiRF Technology Holdings Inc., a maker of location-based technology, reported first-quarter net income of $4.1 million, on revenue of $28.4 million. SiRF started trading Thursday at $12. By the end of its first day of trading, its shares had jumped 28%.
科技业IPO方兴未艾
科技公司首次公开募股(IPO)市场最近的复苏并未借助Google的提振。
就在几个月以前，许多投资者还寄希望于很受网络用户欢迎的搜索引擎Google Inc.，希望它能发起IPO，以便重新点燃人们对这一市场的兴趣。他们的想法是，萧条的科技业IPO市场需要一个像Google这样的知名品牌拉动。市场预计Google本周将宣布推进IPO计划，然而，此时此刻，科技业IPO市场已然自行恢复了生机。
Thomson Financial的资料显示，今年迄今为止，美国已有11家科技公司公开上市，而去年同期这一数字为零。不过，上市潮才刚刚开始。自从3月1日以来，有22家科技公司提出上市申请，超过了之前4个月的总和。其中，3月份申请IPO的科技公司有13家，是2000年10月（23家）以来的单月最高水平。目前等待上市的公司包括：网上珠宝商Blue Nile Inc.、反垃圾邮件软件开发商Brightmail Inc.、网上软件开发商salesforce.com Inc.和Linux firm Lindows Inc.。
Oceanus价值型基金联席经理人、密切追踪新股发行的托利(Tom Taulli)说，和几年前相比，科技业IPO活动目前十分兴旺，这种势头将会持续到IPO通常比较活跃的秋季。该基金管理著1000万美元的资产。
复苏背后的推动力是科技公司希望获得公众资金，同时资金充裕的投资者也在寻找新的投资机会。IPO也为投资银行提供了一个稳健的收入来源。此外，风险投资家们再度将目光投向IPO市场，以期藉此回收他们在私人企业的长期投资。
加州Sevin Rosen Funds的风险投资家多米尼克(Steve Domenick)表示，风险投资方在很多企业有大量的存量投资需要通过上市退出，因此他们许多人一直在期盼市场复苏。
一些科技公司称，在这种背景下，等待Google的IPO就显得没有必要了。部分公司还担心，Google将会抢夺投资者的注意力，还有他们手中的资金。市场预计，Google的IPO将成为十年来最火爆的IPO之一。3月份上市的教育设备生产商AlphaSmart Inc.的首席财务长沃克(James Walker)说，他的公司有意要在Google之前上市，因为公司的规模较小，不希望在争抢中落败。
但是，许多寻求上市的公司收入很低而且亏损严重，这一点投资者十分清楚。Linux免费操作系统开发商Lindows去年实现收入200万美元，但亏损却达400万美元。其审计方最近提出，如果该公司得不到新的投资，其继续运营的能力将受到威胁。3月末提出上市申请的无线软件开发商Seven Networks Inc. 2003年亏损1,290万美元、收入690万美元。上周申请上市的纳米科技公司Nanosys Inc.去年收入300万美元，亏损920万美元。
Lindows、Seven Networks和Nanosys拒绝置评，称眼下它们处于IPO之前的静默期。
但投资银行Broadview International的副总裁大卫。刘(David Liu)说，这些公司的业绩比九十年代末那些仅凭一个业务计划就匆匆上市的互联网公司要好得多。但一些"热门"行业的公司（例如专业半导体公司、互联网广告公司和中国的互联网公司）不顾它们糟糕的财务状况，一心想利用投资者热情高涨的大好时机抓紧上市。Broadview International是Jefferies Group的一个子公司。
因此刘认为，这类正等待上市的科技公司很多最终可能难以成功。他说，很难说它们当中有多少能够顺利上市。
投资银行Needham & Co.的企业融资部联席主管查德。凯克(Chad Keck)说，他一直提醒客户，要想顺利上市，他们需要有赢利，而且季度收入不能低于2,000万美元。但由于今年投资者对IPO的热情日益高涨，情况已经发生了很大变化。越来越多的人开始接纳那些投机性色彩浓重、时机并不成熟的IPO活动，而这些IPO背后隐含著很多危机。
Thomson Financial的首席市场策略师瑞克。彼得斯(Rich Peterson)说，Google如成功上市，可能会有一系列业绩不如Google的公司也接踵而至。他说，在热门行业中，赢利能力和收入等指标已经成了次要因素。
事实上，一些并不赚钱并且短期内收入增长无望的科技公司也在设法上市。例如，2月初，太阳能技术公司DayStar Technologies Inc.在那斯达克市场上市，融资1,050万美元。这家总部设在加州格拉斯河谷的小公司只有8名员工，截至2003年9月30日的9个月中收入仅72,000美元，并且同期亏损810,000美元，其主打产品薄膜太阳能电池要到2005年中期才能面世。这样一家公司居然也上市了。
DayStar负责投资者关系的副总裁凯利。麦卡锡(Kelly McCarthy)称，很多投资者也向公司提出疑问说，他们早早上市是否是想抢占先机，但麦卡锡表示，公司上市时机得当，正好为投资者提供了及早投资于这家再生能源行业前沿公司的机会。
DayStar的股票于3月末开始在那斯达克小型股市场交易，上市价为2.40美元左右。该股周一收盘下跌4.5%，至3.40 美元。Thomson Financial的彼得斯说，该股的上扬在近期上市的公司中并不多见。第一季度上市的10家科技公司中有6家目前的股价低于发行价。
部分新上市的公司是赢利的，包括AlphaSmart。其本月发布的上市后首次季度报告显示，公司实现净利润6.3万美元，收入880万美元，高于上年同期的830万美元。该股于2月份上市，上市价为6美元。周一收盘下跌2.8%，至5.20美元。
此外，定位技术产品制造商SiRF Technology Holdings Inc.第一财政季度实现净利润410万美元，收入2,840万美元，该公司于上周四首日上市，上市价12美元，当天涨幅高达28%。
