SiliconBeat

NetSuite, the software company bankrolled by Oracle’s Larry Ellison that held its initial public offering in December, is spreading out at its current location. It agreed to lease an additional 34,000 square feet in the San Mateo building housing its headquarters, boosting its space more than 50 percent to 93,000 square feet.

It also looks to be paying dearly for the privilege, according to its filing today. Read the rest of this entry »

Yahoo (ticker:YHOO) recently launched its new online business video, Tech Ticker. (Who came up with the subtitle “I love the smell of the profits in the morning”…?)

We’ll reserve judgment on content and quality while it gets its sea legs. But today they’re featuring NetSuite (ticker:N) which reports earnings today. NetSuite was backed by Oracle CEO Larry Ellison and went public back in December. Since then, its stock has fallen almost by 50 percent from its peak to $22.99 in mid-day trading on Thursday.

Here are a couple of videos where host Sarah Lacy cuddles up on the couch with NetSuite CEO Zach Nelson to talk Big Larry, Salesforce.com, and the company’s IPO:

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It would have been nice to have a piece of NetSuite’s IPO Thursday when shares of the San Mateo provider of business software services closed at $35.50, up 36.5 percent from its initial public offering price of $26.

Nicer than that, though, would have been to get options to buy shares of NetSuite the week before it went public at a price that was almost half of that. That’s what the company’s chief executive and nine other officers and directors got, according to the company’s final registration statement.

NetSuite, which first filed to go public in July, used an auction process to sell its shares
similar to the one used by Google three years ago. The company’s first estimate of the price range for the offering was filed in an amendment to its S-1 registration form file Dec. 5 and pegged the range between $13 and $16, the halfway point between which just so happened to be the price of the last-minute option grants to NetSuite insiders.

The company raised that initial range two more times before settling on an offering price Wednesday evening that was higher still.

NetSuite CEO Zachary Nelson’s last-minute grant was good for 93,750 shares, which yielded him an immediate $2 million paper profit. It was the second option granted this year to Zachary who was given the right to buy 125,001 shares priced at $12.40 in June, just weeks before the company filed its plans to go public with the SEC. In addition to a grants for 100,000 shares priced at $5, 244,507 shares priced at 70 cents and 19,783 shares priced at 60 cents, Zachary–who joined the company in 2002–also owns 1.56 million shares outright.

By our calculations, his NetSuite stake was worth roughly $76 million at the end of trading Thursday.

Company founder and chief technology officer, Evan Goldberg, also got a last-minute grant equal to Nelson’s. The value of his total options stake, plus the 3.2 million shares he already owns came to $158.6 million at the end of Thursday.

That’s nice, but nowhere near the $1.13 billion worth of shares owned by the company’s premiere shareholder, Larry Ellison. Shares of Oracle, which Ellison founded and for which he serves as chief executive, rose 6.5 percent the same day as the NetSuite IPO, increasing the value of his Oracle shares by $1.6 billion to $25.9 billion.

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.

NetSuite, the San Mateo software company whose much-awaited initial public offering is generating so much buzz that the IPO’s price range has been raised two times in two days, made a filing today with the SEC to “update or correct some of the facts stated” in an article about it published Tuesday in the New York Times, the text of which is included in its filing.

Since the article ran, which reported an increase in the IP0’s price range on Tuesday to
$16 to $19 from $13 to $16, the range was raised again on Wednesday to $19 to $22 per share, according to the company’s sixth amendment to its initial IPO filing. The shares are being sold according to an auction method similar to the way Google shares were first offered to the public.

The Times article, by a former Mercury News colleague, Laurie J. Flynn, also said that in a Dutch auction the “share price is based on the highest bid that ensures that all” shares will be sold. The company pointed out, however, that NetSuite and the underwriters have “discretion to set the initial public offering price below the auction clearing price.”

As for corrections, NetSuite said in its filing that the article, “incorrectly states that
NetSuite’s net loss for the first nine months of 2006 was $26.9 million, rather than $27.6
million, as set forth in the preliminary prospectus.” And this: “The article states that
[chief executive] Zachary Nelson joined NetSuite in 2000, instead of 2002, as set forth in the preliminary
prospectus.”

Glad they cleared that up.

In its amended filing Wednesday, the company also corrected some its own handiwork, updating the percentage of stock owned by its largest shareholder, Larry Ellison, as of Sept. 30 to 61 percent from 60 percent. For Ellison, every little bit counts.

NetSuite, the San Mateo software maker planning an initial public offering as soon as this
week, raised the price range for it Tuesday to $16 to $19 per share, from the $13-to-$16 range it had estimated in a filing on Dec. 5.

That raised the potential proceeds from the NetSuite IPO to $135 million from $114 million under the previous pricing range. When the company first filed its intention to go public in July it estimated it would raise $75 million.

The company, which is majority owned by Oracle founder and chief executive Larry Ellison, is selling its shares through an Internet auction similar to Google’s offering in August 2004. WR Hambrecht +Co, a long-time proponent of the method, is one of the underwriters for the offering.

The company sells on-demand business applications over the Internet and competes with Salesforce.com, led by former-Ellison-underling-and-now-nemesis, Mark Benioff. Sound fun? Read more about it.

Larry Ellison’s NetSuite is going public this week. The San Mateo company has already started taking bids in its IPO auction process. Check out our summary of the fun. And don’t forget to read the NetSuite prospectus.