December 18, 2003 10:57 AM PST
Salesforce.com files for IPO
Salesforce, a services company that delivers customer relationship management software over the Web, is hoping to raise $115 million, judging from its IPO registration filing fee. The 5-year-old company, founded by a former Oracle executive, fits the profile of tech companies that have recently gone public--it's profitable.
The company, which has 8,000 customers that subscribe to its service, reported revenues of $66 million during the nine months ended Oct. 31, compared with $35.4 million for the same period a year ago, according to the SEC filing.
Forty percent of its revenue came from small companies with fewer than 200 employees, while midsize companies of at least 200 employees and up to $500 million in revenue accounted for 30 percent. Large companies with over $500 million in revenue made up the remaining 30 percent of its business.
Salesforce generated net income of $4.7 million during the nine-month period, including noncash income of $4.3 million, representing a small profit for the company. Last year, the company reported a net loss of $7.2 million during the same period.
Salesforce competes against the likes of industry titans SAP, PeopleSoft and Oracle. But the company finds itself in more head-to-head battles with Salesnet and UpShot. The latter was recently acquired by Siebel Systems. All three provide access to CRM software via the Internet. They run and maintain the CRM software on their computers and charge customers a subscription fee to access it.
Salesforce plans to use the IPO proceeds for general corporate purposes and, possibly, some acquisitions, according to the SEC filing. Information on the IPO's pricing range will be submitted at a later date, when the company amends its filing.
Morgan Stanley is the lead banker in the deal, which also includes Deutsche Bank Securities, UBS Investment Bank, Wachovia Securities and William Blair & Co.