Larry Ellison’s NetSuite (ticker:N) went public today. Read our story here. And read NetSuite’s SEC filing here. The company had bumped up its offering price to $26 per share from an initial target range of $13-$16. The result is that the company raised almost twice as much money as it expected just a couple of weeks ago.
Many people will look at the initial reaction to the stock, which dipped when trading opening and then barely recovered. But NetSuite was smart. The big pop that was so desired back in the dot-com days meant that companies were trading hype for money. If a company’s IPO soared when trading first opened, it meant that investors felt it was worth far more than what the price the company offered. And that meant the company priced it too low, leaving millions of dollars on the table.
NetSuite, on the other hand, appeared to have priced its IPO just right, meaning it captured a bigger share of the money for its own use.