Oct 6 Shares of Coupa Software Inc, a
U.S. maker of cloud-based software that helps companies manage
spending, more than doubled in their debut on Thursday,
underscoring strong market appetite for IPOs by tech companies -
even unprofitable ones.
Coupa's stock rose to a high of $39.50 in early trading on
the Nasdaq, valuing the company at $1.9 billion.
The offering of 7.4 million shares was priced at the top end
of the expected range of $16-$18, raising about $133 million for
the San Mateo, California-based company.
Coupa's successful launch comes less than a week after
shares of data storage provider Nutanix Inc - another
company that has yet to make a profit - soared 130 percent in
A flood of private funding has helped many Silicon Valley
startups achieve $1 billion-plus valuations in the past few
years. Making a profit is not a requirement for joining the
so-called "unicorn" club.
Strong demand for shares in Coupa, which reported a bigger
full-year loss for the year ended January, showed that public
investors are also willing to bet on companies with potential.
Coupa's annual revenue jumped 65 percent to $83.68 million.
"Right now, public investors are very thirsty for a return
and if they think they can get it on IPOs you'll see demand
surge for IPOs," said Glenn Solomon, managing partner at GGV
This year has been a quiet one for IPOs, due largely to
market volatility caused by uncertainty over global economic
growth, worries about U.S. interest rates and Britain's
referendum on its membership in the European Union.
The U.S. technology IPO market has raised just over $2.3
billion so far this year, about half the $4.56 billion raised in
the same period last year.
But several of those that did go public have fared well.
Shares of software maker Twilio Inc - which is also
not profitable - are trading nearly four times above their June
Coupa, whose customers include Staples Inc and
credit card issuer Capital One Financial Corp, reported
a net and comprehensive loss of $46.16 million in 2015/16, up
from $27.3 million a year earlier.
Morgan Stanley & Co LLC, J.P. Morgan Securities LLC,
Barclays Capital Inc and RBC Capital Markets LLC were among the
underwriters of the company's offering.
(Reporting by Richa Naidu in Bengaluru. Additional reporting by
Lauren Hirsch, Heather Somerville and Sruthi Shankar; Editing by