Company Overview
| Company Name |
BAZAARVOICE INC |
| Company Address |
3900 N. CAPITAL OF TEXAS HIGHWAY
SUITE 300
AUSTIN, TX 78746 |
| Company Phone |
512-551-6000 |
| Company Website |
www.bazaarvoice.com |
| CEO |
Brett A. Hurt |
| Employees (as of 1/31/2012) |
780 |
| State of Inc |
DE |
| Fiscal Year End |
4/30 |
| Status |
Priced (2/24/2012) |
| Proposed Symbol |
BV |
| Exchange |
Nasdaq National Market |
| Share Price |
$12.00 |
| Shares Offered |
9,484,296 |
| Offer Amount |
$113,811,552.00 |
| Total Expenses |
$3,476,906.00 |
| Shares Over Alloted |
0 |
| Shareholder Shares Offered |
484,296 |
| Shares Outstanding |
56,856,168 |
| Lockup Period (days) |
180 |
| Lockup Expiration |
8/22/2012 |
| Quiet Period Expiration |
4/4/2012 |
| CIK |
0001330421 |
We estimate that the net proceeds from our sale of 9,000,000 shares of common
stock in this offering at the initial public offering price of $12.00 per
share, after deducting underwriting discounts and commissions and estimated
offering expenses, will be approximately $97.0 million or $112.8 million if the
underwriters’ over-allotment option is exercised in full. We will not receive
any proceeds from the sale of shares of our common stock by the selling
stockholders.
The principal purposes of this offering are to create a public market for our
common stock, obtain additional capital, facilitate our future access to the
public equity markets, increase awareness of our company among potential
clients and improve our competitive position.
We do not have current specific plans for the use of the net proceeds from this
offering. However, we generally intend to use the balance of the net proceeds
from this offering for working capital and other general corporate purposes. We
also may use a portion of the net proceeds to acquire or license, or invest in,
products, services, technologies or other businesses. The amount and timing of
these expenditures will vary depending on a number of factors, including
competitive and technological developments and the rate of growth, if any, of
our business.
Pending their use, we plan to invest our net proceeds from this offering in
short-term, interest-bearing obligations, investment-grade instruments,
certificates of deposit or direct or guaranteed obligations of the U.S.
government. Our management will have broad discretion in the application of the
net proceeds from this offering to us, and investors will be relying on the
judgment of our management regarding the application of the proceeds.
The market for social commerce solutions is highly competitive. The competitive
dynamics of our market are unpredictable because it is at an early stage of
development, rapidly evolving, fragmented and subject to potential disruption
by new technological innovations.
We believe the principal competitive factors in our market include the
following:
• product breadth and functionality;
• scope, quality and breadth of client base;
• amount and quality of content;
• service;
• price;
• reputation; and
• operating model efficiency.
We believe that we compete favorably on the factors described above. We compete
primarily against traditional marketing and advertising programs. Many
businesses remain hesitant to embrace social commerce solutions, such as
ratings and reviews, driven by a reluctance to display negative reviews about
their brands, products or services or about other brands displayed on their
websites. Additionally, some businesses have developed, or may develop in the
future, social commerce solutions internally. These businesses may consider
their internal solutions adequate, even if our solutions are superior.
We have several direct and indirect competitors that provide third-party social
commerce solutions, including companies like PowerReviews, Inc. and Revieworld
Ltd. Additionally, we face potential competition from participants in adjacent
markets that may enter our markets by leveraging related technologies and
partnering with other companies.
We may also face competition from companies entering our market, including
large Internet companies like Google, Inc. and Facebook, Inc., which could
expand their platforms or acquire a competitor. While these companies do not
currently focus on our market, they have significantly greater financial
resources and, in the case of Google, a longer operating history. They may be
able to devote greater resources to the development and improvement of their
services than we can and, as a result, may be able to respond more quickly to
technological changes and clients’ changing needs.
Moreover, because our market is changing rapidly, it is possible that new
entrants, especially those with substantial resources or more efficient
operating models, more rapid product development cycles or lower marketing
costs, could introduce new solutions that disrupt the manner in which
businesses use online word of mouth and engage with consumers online to address
the needs of our clients and potential clients.
We cannot be certain that these competitors, both current and potential, will
not offer or develop services that are considered superior to ours or that
services other than ours will attain greater market acceptance.
Company Description
We are a leading provider of social commerce solutions that help our clients
capture, display and analyze online word of mouth, including consumer-generated
ratings and reviews, questions and answers, stories, recommendations,
photographs, videos and other content about our clients’ brands,
products or
services. Bazaarvoice, which literally means “voice of the marketplace,” was
founded on the premise that online word of mouth is critical to consumers and
businesses because of its influence on purchasing decisions, both online and
offline. We enable our clients to place consumers at the center of their
business strategies by helping consumers generate and share sentiment,
preferences and other content about brands, products or services. Through our
technology platform, our clients leverage online word of mouth to increase
sales, acquire new customers, improve marketing effectiveness, enhance consumer
engagement across channels, increase success of new product launches, improve
existing products and services, effectively scale customer support and decrease
product returns.
Word of mouth influences consumers’ decisions to purchase products and
services. Consumers often trust and rely on what other consumers say about a
brand, product or service more than traditional advertising, particularly if
they consider the content to be authentic and credible. The proliferation of
social networks, wikis, blogs and videos has given rise to the social web—a new
era of Internet-enabled social interaction. The emergence of consumer
interaction through the social web has significantly increased the volume and
availability of online word of mouth about products and services. This online
social interaction is proving to have a significant and growing influence on
both online and offline commerce. The rapid adoption of Internet-enabled mobile
devices is further amplifying the impact of online word of mouth by making this
content even easier, more convenient and faster to generate and access. As a
result, there has been a paradigm shift in marketing as traditional methods are
being disrupted and businesses are now seeking solutions that embrace online
word of mouth to more effectively engage and influence consumers.
Our solutions, provided via a Software-as-a-Service, or SaaS, platform, enable
clients to:
• capture and display online word of mouth;
• engage consumers directly by answering product- or service-related
questions;
• analyze feedback and uncover critical insights from online word of
mouth; and
• distribute content among retail and other brand websites both within
and outside our network, which we refer to as syndication.
Our business model focuses on maximizing the lifetime value of a client
relationship. We make significant investments in acquiring new clients and
believe that we will be able to achieve a favorable return on these investments
by growing our relationships over time and ensuring that we have a high level
of client retention. As of January 31, 2012, we served 737 active clients,
including clients in the retail, consumer products, travel and leisure,
technology, telecommunications, financial services, healthcare and automotive
industries. We define an active client as an organization that has implemented
one or more of our solutions and from which we are currently recognizing
revenue, and we count organizations that are closely related as one client,
even if they have signed separate contractual agreements with us for different
brands or different solutions. As of January 31, 2012, we served eight of the
ten most valuable U.S. retail brands according to Interbrand’s 2011 Best Retail
Brands study published in March 2011, 154 of the 2011 Internet Retailer 500 and
87 of the 2011 Fortune 500 companies, including 31 of the top 100 of the
Fortune 500. For the nine months ended January 31, 2012, we served over 92.7
billion impressions and have served over 297.5 billion total impressions since
our inception in May 2005. We define an impression as an instance of online
word of mouth delivered to an end user’s web browser. We sell our solutions
through a direct sales team located globally in the markets we serve, including
the United States, the United Kingdom, Australia, France, Germany and Sweden.
In fiscal years 2009, 2010 and 2011 and the nine months ended January 31, 2012,
we generated revenue of $22.5 million, $38.6 million, $64.5 million and $74.7
million, respectively. In fiscal years 2009, 2010 and 2011 and the nine months
ended January 31, 2012, we generated 15.8%, 25.2%, 24.9% and 23.7% of our
revenue, respectively, from outside of the United States.
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Our principal executive offices are located at 3900 N. Capital of Texas
Highway, Suite 300, Austin, Texas 78746-3211, and our telephone number is
(512) 551-6000. Our corporate website address is www.bazaarvoice.com.