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The Return of the IPO
The IPO market, moribund for nearly two years, is finally warming up. From January to May of this year, 52 companies sold shares in the public market for the first time, compared with only eight in the same period last year. Another 106 companies intend to go public later this year. But there are some important differences this time out. The speculative froth is clearly out of the market, with investors demanding much lower prices than in previous waves of IPOs. The good news for entrepreneurs is that an increasing number of investors are favoring venture-backed fast-growing start-ups over the more established but highly leveraged companies that had been in vogue, says Kathleen Smith, co-founder of Renaissance Capital, an IPO research firm. That’s why today’s crop of IPOs looks a lot like the universe of Inc. 500 companies — fast-growing tech businesses, a smattering of financial services firms, and a few entertainment and consumer companies. Here are five promising up-and-comers that are hoping to go public this year: REALD If you saw Avatar on the big screen, then you have used a RealD product. Co-founders Michael Lewis and Joshua Greer made a bet on 3-D after working together in Creative Artists Agency’s digital media lab. The Beverly Hills company licenses proprietary 3-D technology for use in games, movies, and consumer electronics. Last year, its technology was used in films that accounted for 75 percent of the total domestic 3-D box-office receipts. But it also faces big-name competition from Dolby, IMAX, and others. Skeptics aren’t certain RealD can repeat the huge boost the company enjoyed from Avatar, which helped push the company’s revenue to $189 million for the fiscal year ending March 26, 2010, up from $45 million in 2009, a 324 percent growth rate. Hoping to raise: $200 million BECEEM COMMUNICATIONS The Santa Clara, California, company designs and develops 4G chips for the next generation of mobile wireless devices. In 2009, the company shipped more than 2.5 million chips designed with WiMax, one of two technologies vying to become the standard for 4G. It is also developing chips using LTE, the other G4 technology. Revenue jumped 214 percent, from $14 million to $44 million, in 2009, but the market is competitive, and one customer, Motorola, makes up 51 percent of the company’s sales. Hoping to raise: $100 million QLIK TECHNOLOGIES Big corporate clients such as Qualcomm and Kraft use analytics software from Qlik Technologies to visualize data such as sales trends and cash flow. Qlik, headquartered in Radnor, Pennsylvania, got an early edge in business intelligence software with in-memory technology, which processes data from a computer’s memory rather than from disk storage. But as more software makers adopt in-memory technology, the company may have trouble maintaining its 33 percent growth rate. Hoping to raise: $100 million GAMEFLY Sean Spector and Jung Suh couldn’t find an online video game rental service. So, in 2002, they co-founded, with Toby Lenk, what is often called the Netflix of video games. The Los Angeles company is backed by Sequoia Capital, which also invested in Apple, Oracle, and YouTube. Gamefly, the largest video game rental service in the U.S., had revenue of $85 million in 2009. The company rents its 7,000 titles to more than 380,000 subscribers. But Blockbuster and Netflix have signaled interest in the market. Hoping to raise: $50 million ZIPCAR Membership for Zipcar’s swipe-and-go car-sharing service is more than 400,000 strong. Scott Griffith, a former Boeing executive, signed on as CEO in 2003, but the company has continued to lose money. Some of the IPO’s proceeds will go toward paying down the company’s debt. Still, Zipcar has the lead in the market for car sharing in North America, which could grow to $3 billion by 2016, according to one estimate. Hoping to raise: $75 million Sequoia Capital – WiMax – Initial public offering – Business – YouTube Continue reading
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PR Stunts and Start-Ups
Publicity stunts are on my mind this week. This past Sunday night on the premiere of Mad Men, Peggy suggests paying women to fight over a ham, and scores press coverage for her client. I arrived in Manhattan on Monday morning to find Herald Square turned into a park with an artificial hill, trees and a new Ford Explorer 2011 (which had been revealed on Facebook only two hours prior.) Launching your business should be a deliberate, calculated event. You should prepare, have press materials ready, generate online materials as well, to make sure that people who want to find out more about you can do so easily. But you might consider the value of a stunt to generate attention and sales. Jim Kukral, author of the book, ” Attention! This Book Will Make You Money “, as well as a professional speaker, blogger and Web business consultant has worked with large brands like Fedex and Sherwin Williams. He told me about this small biz example from his book. “ Grasshopper.com provides a virtual phone solution for entrepreneurs who want to sound professional and stay connected…Grasshopper knew that in order to stand out and get some buzz going, and new customers, that they had to do something different. Their solution? Package up 5,000 packs of real chocolate covered grasshoppers and send them out to 5,000 influencers on the Web. People like bloggers and technology pundits and in general people who could, and would, talk about them…This got them a 4,911% traffic increase from April to May, 144,843 video views with 162 comments, 1,500 tweets, 120 blog posts in one month and 7 national TV mentions.” You might not generate as much excitement as Grasshopper.com. But something as simple as “Free Ice Cream to the first 10 people who prove they’re our Fans on Facebook or show us this Tweet” can be just as much fun on a small scale. Peter Shankman, founder of HARO and Author of “ Can We Do that?! Outrageous PR Stunts That Work – And Why Your Company Needs Them ” told me “A stunt for the sake a stunt is pointless. Tie it into something in the news, tie it into what’s going on in the world. Make cupcakes? Send some to Lindsay. Offer career coaching? Give it to Mel Gibson, he’ll need it. But don’t just put something out into the universe without a bigger plan. PR is an ongoing process. One good piece should lead to another. It should foster growth inside and outside the organization. The blessing of a good media piece is a powerful growth tool, both to clients and to employees as well.” A timely example: Beach Bum tanning salon did a “Free Lindsay Lohan” rally the other day. Once you’ve pulled off your ‘stunt’ you need to be able to capitalize on the publicity you’ve generated. Can people find your store, business or site online? Do you have a special offer for people who have shown up for the first time because of your stunt? Do you have a way for them to sign up for a permission-based email list so you can keep in touch with them in the future? Doing something people will talk about around the water cooler (real or virtual) is an accomplishment. But being able to capture the attention and turn it into leads and sales is the real trick. What can your startup learn from the value of pulling a simple stunt? Publicity stunts are on my mind this week. This past Sunday night on the premiere of Mad Men, Peggy suggests paying women to fight over a ham, and scores press coverage for her client. I arrived in Manhattan on Monday morning to find Herald Square turned into a park with an artificial hill, trees and a new Ford Explorer 2011 (which had been revealed on Facebook only two hours prior.) Launching your business should be a deliberate, calculated event. You should prepare, have press materials ready, generate online materials as well, to make sure that people who want to find out more about you can do so easily. But you might consider the value of a stunt to generate attention and sales. Jim Kukral, author of the book, “Attention! This Book Will Make You Money” ,(http://attentionthebook.com) as well as a professional speaker, blogger and Web business consultant has worked with large brands like Fedex and Sherwin Williams. He told me about this small biz example from his book. “Grasshopper.com provides a virtual phone solution for entrepreneurs who want to sound professional and stay connected…Grasshopper knew that in order to stand out and get some buzz going, and new customers, that they had to do something different. Their solution? Package up 5,000 packs of real chocolate covered grasshoppers and send them out to 5,000 influencers on the Web. People like bloggers and technology pundits and in general people who could, and would, talk about them…This got them a 4,911% traffic increase from April to May, 144,843 video views with 162 comments, 1,500 tweets, 120 blog posts in one month and 7 national TV mentions.” You might not generate as much excitement as Grasshopper.com. But something as simple as “Free Ice Cream to the first 10 people who prove they’re our Fans on Facebook or show us this Tweet” can be just as much fun on a small scale. Peter Shankman, founder of HARO http://helpareporter.com/ and Author of “Can We Do that?! Outrageous PR Stunts That Work – And Why Your Company Needs Them” http://www.amazon.com/Outrageous-Stunts-Work-Company-Needs/dp/047004392X told me “A stunt for the sake a stunt is pointless. Tie it into something in the news, tie it into what’s going on in the world. Make cupcakes? Send some to Lindsay. Offer career coaching? Give it to Mel Gibson, he’ll need it. But don’t just put something out into the universe without a bigger plan. PR is an ongoing process. One good piece should lead to another. It should foster growth inside and outside the organization. The blessing of a good media piece is a powerful growth tool, both to clients and to employees as well.” A timely example: Beach Bum tanning salon did a “Free Lindsay Lohan” rally yesterday http://dailycaller.com/2010/07/27/beach-bum-tanning-salons-free-lindsay-rally-only-a-publicity-stunt/ . Once you’ve pulled off your ‘stunt’ you need to be able to capitalize on the publicity you’ve generated. Can people find your store, business or site online? Do you have a special offer for people who have shown up for the first time because of your stunt? Do you have a way for them to sign up for a permission-based email list so you can keep in touch with them in the future? Doing something people will talk about around the water cooler (real or virtual) is an accomplishment. But being able to capture the attention and turn it into leads and sales is the real trick. What can your startup learn from the value of pulling a simple stunt? Mel Gibson – Business – Mad Men – Lindsay Lohan – HARO Continue reading →