A leading global survey software company — SurveyMonkey — made its debut on Nasdaq under the ticker symbol “SVMK” on Sep 26. The IPO was strongly greeted by investors as its shares soared as much as 67% during the first day of trading and were up 43% at the close.
SurveyMonkey has raised nearly $180 million through the IPO offering of 13.5 million shares at $12, above the previous expected price range of $9-$11 per share.
SurveyMonkey: A Good Bet?
SurveyMonkey builds software products that companies can use to get input from employees, customers, and others. Per the IPO filing, the company has attracted an aggregate of more than 60 million registered users to its survey platform since its foundation in 1999. Of the registered users, around 16 million were active in the past year.
The leading software company has a good history of revenue growth, from $207.3 million in 2016 to $218.8 million in 2017. In fact, revenues rose 13.8% to $121.2 million in the first half of 2018. Though revenues are on the rise, SurveyMonkey is operating at a loss. Net loss widened to $27.2 million from $19.1 million in the first half of 2018 and is likely to be about $54 million for the full year. However, the company narrowed its losses from $76.4 million in 2016 to $24 million in 2017.
Elevated operating costs are hurting the company’s profitability. SurveyMonkey is expected to spend roughly $196 million in 2018 compared to $176.9 million last year.
The IPOs in the technology sector have been booming this year with 24 companies going public, per PwC. This is higher than the year-ago number of 11. The upward trend is likely to continue for the rest of the year and the next.
ETFs in Focus
The successful market debut of SurveyMonkey could pave its entry into a number of ETFs in the coming days. Investors seeking to take advantage of growing investor appetite for software services platforms and newly public technology companies could benefit from these ETFs in the months ahead.
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