Yext Is Next

Just last week we posted that Software Infrastructure is Hot Again (and OKTA priced above the range at $17 and has moved up to $23). Less than a week later we have a story out of the Information about how now technology companies are scrambling to find experienced CFO talent to lead them to an IPO. That’s a major change in thinking.

This week (Wednesday) we get the Yext IPO (NYSE: YEXT). Yext is a bit of an odd duck in the space. Despite some initial concerns it looks like demand for the deal is strong. The banks are Morgan Stanley, JPM, RBC, PacCrest and Piper – not a bad cover. We’ll deal with the Google elephant in the room below. The roadshow is such that the slides are not super-helpful although we have them available. You might be better off reading the Yext IPO roadshow transcript instead of trying to follow the sparse slides.

Some investors were spooked by the surrealistic beginning of the roadshow (which is a video in the Facebook style) during which the CEO (Howard Lerman) is seen preaching to a group of rapt employees in some conference room high up in the sky. Mr. Lerman is suited up in an all black ensemble and stares into the camera with blazing blue eyes of conviction. What ensues is a discussion of where to go for lunch and how “curly fries are the best kind of fries.”

Despite the misgivings Yext is definitely onto something. Conventional internet “search” is giving way to different ways of looking for things, especially mobile applications and maps. Consumers also expect much more information at their fingertips, not just a website. Now “results” include detailed business information including hours of operation, reviews, complete menus of food or services, amenities, credit cards accepted, photographs, etc. Questions like “does this hotel allow pets?” or “do they have gluten free menu options?” are often answered right in the listing.