Mulesoft IPO hopes to raise $221M, tap $32B software integrations market

SaaS integration company, Mulesoft, has announced the public offering of 13 million shares of its Class A common stock at $17 per share. The offering will amount to about $221 million in new funding, which according to Axios, will give the company a market capital of around $2.14 billion as well as a fully diluted market value of $2.9 billion. According to media reports, Mulesoft proposed an offering of $14-$16 range and was last valued at $1.5 billion by venture capitalists. This move makes it the first enterprise technology company to go IPO this year. Its SEC IPO filing states that the company’s revenue for 2014, 2015, and 2016 was $57.6 million, $110.3 million, and $187.7 million, respectively, representing a growth rate of 91% and 70% year on year respectively. It also incurred net losses of $47.8 million, $65.4 million, and $49.6 million in 2014, 2015, and 2016, respectively. Mulesoft claims that the Friday offering will be listed under the name ‘MULE’ and will be divided into two common identical stocks Class A and Class B, but with different voting and conversion rights. While Class A will be allowed one vote, Class B will allow 10 votes per share. The company also added that it estimates its current market opportunity to be about $29 billion and quotes a Forrester report that states that the integration software market will spend $32 billion in 2017. The SaaS integrator claims that it has about 1,000 customers located in over 60 countries across every major industry, including 30 customers with over $1.0 million in annual contract value of subscription and support contracts. The company states that its platform can be be adopted by organizations of nearly any size but its focus is in sales efforts for the largest organizations. Goldman Sachs and J.P. Morgan Securities are acting as joint lead book-running managers for the offering. BofA Merrill Lynch is acting as an active book-running manager. Allen & Company, Barclays Capital, and Jefferies are acting as book-running managers and Canaccord Genuity, Piper Jaffray, and William Blair & Company, are acting as co-managers. In the realm of technology enterprises, this is not the only large scale IPO to happen this month. Snapchat also went public earlier this march with an offering of $24 a share, its 200 million shares raised $3.4 billion and was valued at nearly $24 billion as of its pricing. Around that time it also rose to $25 a share but only yesterday, its share price dropped to the below $20 mark, closing at more than 4% less and nearing an IPO price of $17 per share.