Six months after acquiring GetActive Software for $17.9 million, Convio, Inc. today filed documents with the Securities and Exchange Commission (SEC) to begin the process of becoming a public company. The number of shares to be sold and the price range for the proposed initial public offering (IPO) have not yet been determined but the Registration Statement indicated the offering could be as much as $86.25 million. Company officials could not comment on the IPO, according to SEC regulations.
The Austin, Texas-based online fundraising firm expects to use the money raised through the IPO for working capital and other general corporate purposes and possibly for debt repayment or other acquisitions. Some current stockholders will sell shares in the IPO, which will convert all outstanding shares into nearly 36 million shares of common stock. Goldman Sachs will lead the IPO with additional underwriting from Thomas Weisel Partners, William Blair, JMP Securities and Pacific Crest Securities.
Convio has yet to have a profitable quarter since it was founded in 1999. Losses grew to $7.5 million for the six months ending June 30, from $6.2 million in the same period last year. Meanwhile, revenue grew from $15.5 million to $20.8 million during that time. The company had about $14.6 million cash as of June 30 and accumulated deficit of $46 million, according to its SEC filing.
Convio would become the third major player in nonprofit fundraising and software services to go public within the past five years, joining San Diego, Calif.-based Kintera (KNTA) and Charleston, S.C.-based Blackbaud (BLKB). Convio also would trade on NASDAQ, with the ticker symbol CNVO.
Blackbaud filed a $100-million IPO in February 2004, closing its first trading day in July that year with a share price of $8.62. It was trading at around $25 today. Kintera opened publicly in December 2003 at $10.30 per share, raising $40 million, and was trading today around $1.85.
“Providing technology and ongoing innovation to help nonprofits achieve their missions is necessary to meet the changing demands of the philanthropic marketplace,” said Kintera President and CEO Richard LaBarbera. “ Public filing activity as well as mergers mark the continuing growth, importance and market validation of the nonprofit software space. We welcome any actions that benefit our market space.”
The move continues a big year for deals in the nonprofit technology market. In February, Convio bought GetActive Software while Blackbaud purchased Target Software and Target Analysis Group for $60 million. Earlier this month, Blackbaud also announced the purchase of eTapestry for about $25 million, spending nearly $90 million over the last two years on acquisitions.
In 2006, Convio and GetActive had a combined net loss of about $12.5 million, about $5 million each and $2.5 million in adjustments and total revenue of $34 million ($21 million for Convio, $13 million for GetActive), according to its SEC filing. The firm began migrating GetActive clients to its products in June and expects the majority of those activities to be complete by the end of 2009. Convio had more than 1,200 clients as of June 30.
“If they pull it off, and they truly have a business model that can sustain itself, that just solidifies that the nonprofit marketplace is a very viable, thriving place to be,” said Jay Love, co-founder and CEO of eTapestry. “That’s always good news in that regard. It lets more and more of the nonprofits realize that the use of the Internet and all the technology that surround that is truly here to stay, not just to fall off in the future. Obviously these types of tools build strong relationships, which we know what that means to the mission of nonprofits.”