Tech companies have spent billions on marketing automation in the last few years. The big guys. The kinda big guys.
More investors can get a piece of the pie now.
HubSpot, the Cambridge, Mass.-based marketing automation provider rivaling the likes of Marketo, Act-On, Pardot and Eloqua, had its IPO today. It's stock was valued $25 a share. HubSpot is coming off its annual conference last month and prior growth announcements.
Good morning HUBS pic.twitter.com/qZnd4HIO5V— katie burke (@katieburkie) October 9, 2014
HubSpot raised $125 million through its IPO. It changed its shares-offering plan of 5 million shares at $19 to $21 and went with 5 million shares at $22 to $24, according to Renaissance Capital.
"This IPO, coming on the heels of IPO’s by Eloqua and Marketo, serves to remind us how big and untapped this market really is," Act-On CEO Raghu Raghavan said. "In North America alone, there are well over 1,000,000 organizations in need of marketing automation. Hubspot and Marketo between them address less than 2 percent of this market."
HubSpot's naturally confident in the public move.
Some investor buzz out there today has HubSpot doing well under its IPO, too, though.
"HubSpot has been posting operating losses for years," according to Rick Aristotle Munarriz of Daily Finance, "but the IPO should still appeal to growth stock investors willing to forgive today's red ink for the sake of heady growth. HubSpot saw its revenue soar 50 percent last year to $77.6 million."
R Ray Wang, founder and principal analyst of Constellation Research, told CMSWire this morning the big deal here is HubSpot topped out in its stock price demand.
"They hit the top end of the demand for their price at about $25 a share," Wang said. "It's great news for the Boston tech scene with Wayfair and CyberArk going out a few weeks ago."
Moreover, HubSpot's IPO corroborates the marketing tech boom is still wrong, Wang said.
"Investors still see a demand for this software over the next two to three years," Wang said. "HubSpot also has fended off acquisition attempts."
This move is also validates that the SMB market is strong -- even stronger with HubSpot's IPO.
"HubSpot now has the funds for more expansion, growth in other areas beyond marketing, and of course investment in the enterprise," Wang said.
HubSpot and rival Marketo were valued in trading around 10:30 ET today around $31.