After a down week for the US IPO market, three "big data" companies are poised to turn things around. Each is a high-growth, enterprise-focused software provider, a type of company that has seen outsized IPO returns in 2012 (65% to-date on average). Splunk (data analysis), Infoblox (networking) and Proofpoint (data protection) are planning to raise $162 million, $98 million and $68 million, respectively, and all three, along with four energy companies and high-end luggage brand Tumi, are on the IPO calendar for this week.
Splunk allows enterprises to take control of machine-generated data, which traditional database management systems have difficulty handling. Its software indexes unstructured data so that it can be monitored, analyzed and searched. Among its 3,700 customers are a number of industry leaders, including AT&T, Bank of America, Facebook, IBM and Visa. Infoblox's software provides automatic network control, which has become increasingly important as connected devices proliferate. It serves 5,400 customers, including Barclays, IBM and Johnson & Johnson, with a 90% renewal rate. Proofpoint helps companies protect and archive communications data, such as e-mails and instant messages. Bank of America and AON are among its largest customers.
It seems unlikely that investors have had their fill of enterprise software IPOs just yet. ExactTarget gained 32% in its first day of trading last month, while Guidewire (total return 109%), Demandware (68%), Brightcove (65%) and Bazaarvoice (61%) have seen continued growth in the aftermarket. Those returns should help investors look past the group's historical losses and imposing competitors. We expect they will instead focus on the impressive top-line growth and some notable endorsements by blue chip customers.
