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Project management SaaS provider Upland Software sets terms for $50 million IPO

Upland Software, which provides cloud-based project management software to over 1,200 enterprises, announced terms for its IPO on Monday. The Austin, TX-based company plans to raise $50 million by offering 3.8 million shares at a price range of $12 to $14. At the midpoint of the proposed range, Upland Software would command a market value of $186 million.

Business: Roll up of work management software

Upland Software's offerings cover a wide range of work management functions in organizations, including IT, marketing, budgeting and operations. The company was founded in 2010 and has made six acquisitions since 2012, which account for substantially all of its revenue. Upland plans to continue to pursue complementary product acquisitions and employ a "land-and-expand go-to-market" strategy. It generates sales from subscription and support (74% of 1H14 revenue), implementation and related professional services (23%) and perpetual licenses (3%).

In 2012 it acquired PowerSteering (program and portfolio management software; $13 million purchase price), Tenrox (professional services automation; $15 million) and EPM Live (project collaboration; $8 million). Its 2013 acquisitions include FileBound (document-based workflow automation; $15 million), ComSci (management of IT ROI; $8 million) and Clickability (web content optimization; $12 million).

Shareholders

Primary shareholders include Dubai-based DevFactory (18% post-IPO stake), Austin Ventures (14%), John McDonald (13%) and Activant Capital (5%). The company is managed by founder, Chairman and CEO John McDonald and CFO Michael Hill, both of which previously held similar roles at Perficient ( PRFT ).

Financials

Revenue rose 70% to $32 million during the six months ended June 30, 2014, which was almost entirely due to acquisitions made in 2013. Gross margin fell 280 bps to 64% due to higher personnel costs related to those acquisitions. Adjusted EBITDA rose just 26% to $2.6 million. Net loss widened from $2.6 million to $15 million due to a one-time stock-based consideration to a related party technology vendor. Deferred revenue was $20 million at the end of the 2Q14, and its net dollar retention rate was 90% in 2013.

2014 SaaS IPOs

Recent SaaS IPOs include marketing automation platform provider HubSpot (HUBS; up 28%) and financial data aggregator Yodlee (YDLE; 18%). Customer service SaaS platform provider ZenDesk ( ZEN ) is among the best-performing offerings of the year, up over 130% from its May IPO. SaaS platform provider Workiva ( WK ) filed for a $100 million IPO in mid-October, and could launch as early as next week.

Upland Software, which was founded in 2010 and booked $54 million in sales for the 12 months ended June 30, 2014, plans to list on the NASDAQ under the symbol UPLD. William Blair and Raymond James are the joint bookrunners on the deal. It is expected to price during the week of November 3, 2014.

The article Project management SaaS provider Upland Software sets terms for $50 million IPO originally appeared on IPO investment manager Renaissance Capital's web site renaissancecapital.com.

Investment Disclosure: The information and opinions expressed herein were prepared by Renaissance Capital's research analysts and do not constitute an offer to buy or sell any security. Renaissance Capital, the Renaissance IPO ETF (symbol: IPO) or the Global IPO Fund (symbol: IPOSX) , may have investments in securities of companies mentioned.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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