Cyan, which provides a software-driven transport/switching platform for network operators, raised $88 million by offering 8 million shares at $11, within its $10 to $12 range. The company has seen extraordinary growth since it began shipping its first products in late 2009, though it remains unprofitable. Revenue in 2012 totaled $96 million, up from $40 million in 2011.
Cyan represents the first pure-play telecom equipment/software IPO in the U.S. since video processing platform vendor Envivio (ENVI) debuted in April 2012 (Envivio has since dropped 83% from its $9 offer price). WiFi equipment supplier Ruckus Wireless (RKUS), which derives roughly one-third of its revenue from telecom carriers in the US and Asia, went public on November 15, 2012. Ruckus Wireless rose as much as 77% from its IPO price by mid February, but tumbled 26% on Tuesday (and now sits below its offer price) after issuing a revenue and earnings shortfall. The company cited deployment delays from its telecom customers.
Cyan, which has venture backing from Norwest, Azure Capital, Tenaya, Focus Ventures and Meritech, is led by a veteran management team including former executives from broadband equipment provider Calix (CALX) and optical switch company Cerent (acquired by Cisco for $7 billion in 1999).
Cyan will list on the NYSE under the symbol CYNI. Goldman Sachs, J.P. Morgan and Jefferies & Co. acted as bookrunning managers on the deal.
