Bazaarvoice, which allows companies to view and analyze online feedback from consumers through on-demand software, announced terms for its IPO on Thursday. The Austin, TX-based company plans to raise $85 million by offering 9.4 million shares (5.1% insider) at a price range of $8.00 to $10.00. At the midpoint of the proposed range, Bazaarvoice would command a market value of $570 million.
Bazaarvoice, which was founded in 2005, delivered 38.8 billion pieces of feedback to its 737 clients, which include Proctor & Gamble, Microsoft and Domino's, in the most recent quarter. Its platform is built into Facebook, whose continued cooperation is cited as a risk factor. The excitement around Facebook could be beneficial though, as companies recognize the growing importance of and marketing opportunities available in social media.
Bazaarvoice booked $28 million in sales for the 3 months ended 1/31/12, an increase of 10.3% sequentially and 59.5% year over year. Gross margin increased for at least the fifth straight quarter to 65.5%, up from 61.4% in the three months ended 1/31/11. Net income, however, declined 55.0% over that same period to -$7 million for the most recent quarter.
Venture capital firms Austin Ventures (25.5% stake post-IPO) and Battery Ventures (13.9%) are the primary backers. Founder and CEO Brett Hurt previously founded Coremetrics, which was acquired by IBM in 2000. Chief Marketing Officer Erin Nelson held the same position at Dell before joining in 2010.
Bazaarvoice plans to list on the NASDAQ under the symbol BV. Morgan Stanley, Deutsche Bank Securities and Credit Suisse are the lead underwriters on the deal.
