Our 2016 Predictions For The IPO Market

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Our 2016 Predictions For The IPO Market

2015 was not a good year for IPOs — it was actually the worst year for tech IPOs since the financial crisis in 2009. More and more startups are opting to remain private for longer periods of time.

And while we still haven’t seen any IPOs in 2016, the slowest start since 2009, eventually venture-backed companies need to go public — if only to raise additional financing to continue operating. We’re starting to hear murmurs about late-stage financing drying up.

“The ease of capital at lofty valuations in the private markets is starting to tighten up,” said Shriram Bhashyam, co-founder at EquityZen. “Funding terms are getting more onerous, with more protective provisions in place for investors.”

Now many startups are bringing in banks like Credit Suisse — which often run IPOs — to run their financing rounds.

Garvis Toler, Global Head of Capital Markets at the New York Stock Exchange tells TechCrunch that he is “quite optimistic about 2016,” particularly because “lots of enterprise companies are showing a lot of interest in the public market.”

So, let’s take a rundown of some companies that are both household names, or otherwise unknowns, that could go public this year, according to what we’re hearing from our sources.

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AppDynamics

Founded in 2008, AppDynamics is almost a unicorn twice over, having last raised capital at a $1.9 billion valuation. A competitor of New Relic, AppDynamics helps prevent website outages. Clients include Cisco, OpenTable and the Nasdaq.   CEO David Wadhwani tells TechCrunch that they are seeing “rapidly growing market demand” for their services and will be expanding their product and sales divisions this year. The company has been talking about an IPO for several years now, but TechCrunch is hearing that AppDynamics hopes to reach the milestone in 2016.

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AppNexus

AppNexus helps over 500 ad tech companies program their digital advertising. Competitors include Mediamath and Google’s DoubleClick. Ad tech has certainly been a challenging market, but New York-based AppNexus has still been able to raise more than $288 million. In August 2014, the company said it was worth $1.2 billion.

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Apttus

With its “Quote-to-Cash” business, San Mateo-based Apttus says its software speeds up the sales process by helping businesses follow through and collect money from prospective customers. Apttus CEO Kirk Krappe recently told TechCrunch that the company intends to go public this year. Krappe also said that they would be open to selling Salesforce, but while the venture arm backs Apttus, Salesforce recently acquired competitor, SteelBrick. Founded in 2006, Apttus has raised at least $186 million in capital and a unicorn valuation.

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Blue Coat

The internet security software company was acquired by Bain last year, but Blue Coat is already gearing up to go public. Founded in 1996, this wouldn’t be Blue Coat’s first run as a public company. Previously listed on the Nasdaq, Blue Coat was acquired by private equity firm Thoma Bravo for $1.3 billion in 2012. Bain then purchased it for $2.4 billion last May.

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Domo

Domo is one of a handful of anticipated tech IPOs coming from Utah. Domo provides business intelligence and data visualization for clients like eBay and National Geographic. Founded in 2010, the company is run by Omniture co-founder Josh James. The unicorn has raised over $400 million in funding and is said to have a $2 billion valuation.

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Glassdoor

People have been talking about a Glassdoor IPO for a while now, but it looks like 2016 might finally be the year. The job search site has raised over $160 million in funding, with its latest round in January of last year. So it’s around the time that it would likely look for more financing as it continues to scale. The company is basically a platform play that relies on user-generated input, but its data set is powerful and likely strong enough to attract potential investors.

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InsideSales.com

InsideSales.com is another one of the expected IPOs coming from Utah this year. Founded in 2004, the sales platform has raised over $200 million in capital, after bootstrapping for several years. InsideSales.com says its big data helps with lead generation and they have worked with a range of companies including Groupon and LendingTree.

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Nutanix

While a lot of people were expecting datacenter platform Nutanix to go public last year, unstable markets caused some companies to wait until 2016. Nutanix has already revealed its IPO filing, and the growing yet unprofitable startup is said to be planning an offering in the coming weeks. Founded in 2009, the San Jose-based company has raised over $300 million in capital at a $2 billion valuation. CEO Dheeraj Pandey recently said that he hopes his company will foster the culture of Google and the execution of Amazon.

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Okta

Okta produces identity management software, but recently sought to expand into security, mobile device management and two-factor authentication. The company hit unicorn status when it raised $75 million at a $1.2 billion valuation. In September, it looked like Okta would be going public in the next 12 to 18 months — which sounds about right, according to what we’re hearing.

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Pluralsight

Yet another potential IPO out of Utah, Pluralsight is a leader in educational technology, with online developer and IT training. Like many of the Utah companies, Pluralsight bootstrapped and was profitable before it took outside funding. CEO Aaron Skonnard told TechCrunch that Utah’s “startup culture rewards companies that are built to last.”

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SoFi

SoFi is disrupting the student loan and mortgage industry and it’s growing fast. Founded in 2011, SoFi has already processed $7 billion in loans. The unicorn has raised over a billion dollars in funding at a $4 billion valuation. CEO Mike Cagney has been candid about their IPO goals. 

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Twilio

We’ve heard murmurs about this one: Twilio has had a pretty successful run and is at that stage that it could probably go public and attract investors. The company handles telephony services and charges for its tools, which means it has a business model in place and likely has a path to profitability once it hits a certain scale — if it hasn’t already. The San Francisco-based company has raised over $240 million in capital at a $1 billion valuation.

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