When MongoDB (NASDAQ:MDB) went public in October 2017 at just $24 per share, it's safe to say that most investors were skeptical. MongoDB was just one stock in a large pool of small and mid-cap software IPOs that year, and its predecessors hung a cloud over its fate - after all, Cloudera (CLDR) sits in both the open source and infrastructure categories, and that stock has been one of the worst-performing IPOs of 2017 (its CEO just recently resigned).
At MongoDB's current share price of $168, the company has a titanic market cap of $9.21 billion (and though the differences in quality between the two companies are night and day, it's worth pointing out that MongoDB has a market cap that is 6x smaller, despite being 2x MongoDB's revenue scale). After netting out $476.4 million of cash and $220.1 million of convertible debt on MongoDB's balance sheet, we are left with an enterprise value of $8.95 billion.
X"@context":"https:\/\/schema.org","@type":"VideoObject","name":"Thursday's Biggest Business Headlines In A Minute (Or Less)","description":"Reactions to Adobe and eBay's results from the night before, plus earnings reports from Verizon, Winnebago and others.","thumbnailUrl":"https:\/\/www.investors.com\/wp-content\/uploads\/2017\/10\/AMheadlines101917-thumb-640x360.png","contentUrl":"https:\/\/content.uplynk.com\/f3caf111a2f94bf4b27e607d5bf6fe17.m3u8","uploadDate":"2017-10-19T07:04:00+0000","duration":null,"author":"@type":"Person","name":"ELAINE LOW","publisher":"@type":"Organization","name":"Investor's Business Daily","logo":"@type":"ImageObject","url":"https:\/\/www.investors.com\/wp-content\/uploads\/2020\/06\/ibd-logo.png","url":"https:\/\/www.investors.com","keywords":""MongoDB, late Wednesday, priced 8 million shares at $24, above the upwardly revised range of $20 to $22. The stock opened at 33 and ended the trading session up 33.6% to 32.07 on the stock market today.
The MongoDB IPO follows the strong debut of China-based online credit firm Qudian (QD) on Wednesday, which raised $900 million. Qudian priced shares at 24 and finished the day up 32%. Qudian shares were up another 5%, trading near 30.70 Thursday morning.
Sea is backed by China online gaming and messaging giant Tencent Holdings (TCEHY) (IBD), which is a principal shareholder. Tencent has indicated interest in acquiring about $100 million worth of shares, or about 15.5% of the offering.
Also coming is Rise Education Caymen, a China-based provider of education services. Rise looks to raise $143 million by offering 11 million American depositary shares at a range of $12 to $14. IPOboutique.com says the Rise IPO is also "many multiple times oversubscribed." Rise is set to price Thursday and trade Friday on the Nasdaq under the ticker REDU.
During its IPO, MongoDB raised $192M at $24 per share, almost 30% higher than the initial price range of $18-$20 per share, valuing the company at $1.17B. These shares, however, came with limited voting rights. Its 40M Class B shares carrying 10 votes per share were mostly owned by venture capitalists like Sequoia, Flybridge, and NEA.
All said and done; the company is yet to turn profitable. In fact, the net loss of $77.1M was wider than the $64.5M loss it reported during the same period last year. The loss per share of $0.24 was also higher compared to the $0.22 last year.
While profits seem to be a distant dream still, competition is certainly heating up. Confluent, a data analytics provider spun out of LinkedIn in 2014, is now worth $15B, up 60% since its IPO in June. Elastic, another open-source company providing tools for enterprise search, is also valued at $15B. Its shares have quintupled since its 2018-IPO.
MongoDB was founded in 2007 by DoubleClick founders Dwight Merriman, Eliot Horowitz, and Kevin Ryan, but went public on October 19, 2017 at $24 per share. On the first trading day, shares spiked 34% to $32.07 at the end of its first trading day after hitting an intraday high of $34.
Fast forward just two years and four months later, and MongoDB's stock sits at a whopping $172 per share as of this writing. That's over a seven times return in just over two years. If you had decided to make just a relatively modest $1,000 bet on MongoDB at its IPO, that stake would be worth $7,166 today. Even if you had "bought high" on the stock's first day of trading at $34, you still would have made over five times your money, or roughly $5,059.
In addition, the database is a particularly attractive product, even by enterprise-software standards, because it stores and organizes all or part of a large corporation's most important data. If a company wanted to switch vendors, it would have to lift all of that data from the old database and insert it into a new one. That's not only a huge pain; it's also terribly risky, should any data get lost. Therefore, most companies tend to stick with their database vendor over time, even if that vendor raises prices. That's how Oracle became such a tech powerhouse throughout the 1990s.
Billy Duberstein owns shares of MongoDB. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends Alteryx and MongoDB. The Motley Fool has a disclosure policy.
Internet of things (IoT) company Samsara saw a strong IPO on Dec. 15. After pricing its shares at the top end of its range at $23, share prices immediately rose by 7% to $24.90, valuing the company at $12 billion.
Open-source software company HashiCorp enjoyed a solid public debut on Dec. 9, where its stock debuted on the Nasdaq above expectations at $80 a share and rose by as much as 10% on the first day of trading. It closed the day at $85, valuing the company at $14 billion.
Marketing software company Braze saw its shares rise by as much as 44% during a brisk first day of trading on the Nasdaq in November. Having initially priced its IPO at $65, shares rose to $93, valuing the company at $8.4 billion.
Expense management software company Expensify debuted on the Nasdaq in November, with shares listing at $27, valuing the company at $2.2 billion. (They rose by as much as 45% to $39 a share on its first day of trading.) Founded in 2008 in Portland, OR, the fintech company specializes in receipt tracking and expense management software for individuals and businesses.
Online education company Udemy endured a tough market debut at the end of October, where its shares quickly dipped below its listing price of $29, closing the first day of trading down at $27, valuing the San Francisco-based company at $3.7 billion.
Chipmaker GlobalFoundries sold 55 million shares on its Oct. 28 Nasdaq debut at $47 each, the top end of its expected range of $42 to $47. The price fluctuated during the first day of trading, dropping by as much as 5.3% before rebounding to end the day down 1.3%. That put the company's value at around $25 billion. It was the third biggest technology IPO of the year to date, trailing only the South Korean e-commerce firm Coupang and Chinese ride-hailing company DiDi.
Toast, which provides various software products to restaurant owners, including payments processing, successfully floated on the New York Stock Exchange on Sept. 22 at $40 per share, well above its expected range of $34 to $36, valuing the company at $20 billion. Shares continued to rise by as much as 56% on its first day of trading, with an implied valuation of $31 billion.
Enterprise software maker Freshworks saw a strong IPO on Sept. 22, with shares opening at $43.50, 21% above expectations, valuing the company at $12 billion. Prior to trading on the Nasdaq, the company had already upped its initial stock price to $36, above its expected range of $32 to $34.
Software consultancy Thoughtworks had a strong IPO in September, when shares rose 24% on its Nasdaq debut. The stock opened at $26, well above its expected range of $18 to $20, valuing the company at nearly $9 billion.
NoSQL database specialist Couchbase saw its stock price jump by as much as 39% on its July 22 market debut, valuing the company at more than $1 billion. Initially priced at $24 a share on the Nasdaq exchange, stock in the company jumped to $33.25 a share on its first day of trading, up 38.5%, before settling closer to $30 at the end of the day.
UK cybersecurity company Darktrace floated on the London Stock Exchange on Apri 30l, with shares rising by as much as 43% to Â3.58 on the first day of trading. That's up from its guide price of Â2.50, giving the company a value of around Â2.4 billion.
As part of an IPO companies can also elect to allow existing shareholders to sell some of their shares. This is not as typical, and is generally a much smaller component of the total IPO size then the primary shares offered. Because no new shares are offered as part of secondary sales this is non-dilutive. The proceeds from secondary sales go directly to the bank accounts of the individuals selling, and the company receives no proceeds from them.
This is simply the result of multiplying the share price by the number of primary shares issued (Column A x Column B), and represents the gross proceeds (proceeds before fees and transaction costs) that the company receives as part of their IPO.
This is simply the result of multiplying the share price by the number of secondary shares shares (Column A x Column C), and represents the aggregate proceeds that the selling shareholders receive as part of the IPO.
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