Which Seattle tech companies could take the IPO plunge in 2012? Photo via Bigstock

The world may be waiting on a Facebook IPO. And while there’s some chatter about whether the $5 billion public offering from the social networking giant will open the floodgates for tech offerings, The Wall Street Journal today notes that it might be a new breed that actually woos Wall Street: enterprise IT companies.

That’s in contrast to the Zillows and Groupons and LinkedIns of the world that went public in 2011. The Journal quotes Madrona’s Matt McIlwain who says that enterprise IT firms have “compelling and repeatable” business models.

That could be good news for Seattle, which historically has produced some of the behind-the-scenes IT infrastructure and business services that help power the Internet or make enterprises more efficient. (F5 Networks, Concur, Isilon Systems, etc.).

With that in mind, I started wondering which Seattle area companies actually might take the IPO plunge in 2012. Pretty quickly I came up with five names which show the diversity of the technology industry in Seattle. Now, it’s unclear to me whether any of these will pull the trigger, and few will tell you if and when they plan to drop an S-1 filing. But, nonetheless, here’s my short list. Who did I miss?


INRIX CEO Bryan Mistele. Photo: Annie Laurie Malarkey

After raising a $37 million venture capital round last summer from venerable venture capital firm Kleiner Perkins Caufield & Byers, INRIX CEO Bryan Mistele told GeekWire that his Kirkland company was already bigger than Zillow. A spin off from Microsoft Research, INRIX’s traffic data now powers most of the major navigation applications and is now available in 30 countries. Solidly profitable and growing, the company bought its main European rival in August for $60 million.

Mistele has not hidden his intentions for an IPO, telling GeekWire last year that traffic analysis is a billion dollar opportunity. “We are certainly on the path of wanting to take this business public,” he said in July.

Big Fish Games:

Seattle’s under appreciated gaming industry has already seen some fantastic exits in the past year, namely EA’s buyout of PopCap and IGT’s acquisition of Double Down Interactive. Big Fish certainly has the revenue numbers to go public, posting $140 million in sales in 2010. Founded in 2002 by former RealNetworks manager Paul Thelen, Big Fish named former Amazon.com and Procter & Gamble finance exec David Stephenson as CFO last year.

Long discussed as a possible IPO candidate, Big Fish hasn’t grown as fast as social media gaming powerhouse Zynga which went public last year and now boasts a market value of nearly $10 billion. If Big Fish doesn’t take the plunge in 2011, could Seattle’s surprise gaming hit actually be the wildly successful (and super low key) Valve?


Sunny Gupta interviewed at 2011 the Seattle 2.0 Awards

Apptio CEO Sunny Gupta makes no bones about it. He wants to build the next big enterprise software company in Seattle. He appears to be on that path. Speaking at the WTIA’s TechNW event in Seattle last year, Gupta noted that Apptio is on course for bookings of $50 million to $60 million in 2011. “We are trying to build something of substantial scale,” Gupta said at the time. “We run our business like we wanted to build a great product, a great market, a great new category as opposed to thinking about an exit.”

We’ve heard rumblings of a possible Apptio IPO filing in recent days, and Madrona’s McIlwain (who helped guide Isilon to an IPO and eventual sale to EMC) is a board member. Could McIlwain’s remarks to The Wall Street Journal have been an indirect hint about Apptio? Possibly.

Tableau Software:

Tableau’s IPO aspirations aren’t really a mystery. CEO Christian Chabot is an ex-VC and he’s long yearned to take the Stanford University spin out public. 2012 might be the year for the maker of data visualization products, especially if the trends around enterprise IT and “big data” hold steady. The Seattle company has experienced a significant growth spurt in recent months, and that momentum continues with Tableau announcing in January that it plans to add 300 workers this year. Sales doubled to $72 million in 2011, which means the company is starting to get into the ballpark where investment bankers take notice.


Darrell Cavens of Zulily

Daily deal sites were all of the rage in 2011. Will that momentum continue this year? If so, Zulily could take the plunge into the public markets. The company, which has kept a relatively low profile since it was founded by former Blue Nile executives Mark Vadon and Darrell Cavens, is one of the fastest-growing Internet upstarts in Seattle. Zulily has already outgrown three offices in its short history, and our sources said the company was on pace last year to top $150 million in revenue.

Former Big Fish and aQuantive exec Michael Vernon joined as CFO last year — a possible sign of IPO dreams. [Update: As a GeekWire reader noted in the comments below, Vernon has left the company. We confirmed Vernon’s departure with Cavens who declined to comment on the departure. The company continues to look for a CFO]. Zulily raised a massive $43 million venture capital round from Meritech Capital and others that valued the company at about $750 million. Too bad Zillow already nailed down the Nasdaq ticker symbol “Z.”

And just for fun of it here’s a wild card to toss into the mix: Redfin. Even though CEO Glenn Kelman recently remarked that the company is not ready for a public offering, Zillow’s success in the marketplace has got to being weighing on the minds of the investors. Interestingly, Redfin just posted a job for a general counsel, certainly a position that would be needed for a company thinking about taking the IPO leap.

“We have some things we have to work out before we go public,” Kelman told us last month after the company cut the rebates it offers to home buyers.

It seems like it could be another year before Kelman and board decides to go for it. But if the real estate market shows signs of life and Redfin can gain market share in the cities where it operates, they could jump to.

Who did I miss?

[Diving photo via Bigstock]

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  • http://blog.redfin.com/ GlennKelman

    Not Redfin, not in 2012. We improved our service too John, not just increased prices.

    I can’t wait to see Zulily and Apptio go out. Amazing companies.

    • johnhcook

      Thanks Glenn. As I said, more likely for 2013 for Redfin. I just thought the general counsel job post might be a hint of what’s to come. :)

      What could be interesting about Apptio and Zulily is that both are backed by Seattle area venture firms. This is probably a column for another day, but I’ve been struck by how some of the big exits around here (Zillow, PopCap and Double Down) didn’t really have Seattle VC money involved. BTW, I should have noted that there is another Madrona-backed company waiting in the wings. Impinj filed to go public last year, but it has been pretty quite since their last amended S-1 in July.

  • http://blog.calbucci.com/ Marcelo Calbucci

    Whitepages? All Star Directories? Cheezburger? Wetpaint? SEOmoz? Avvo? Tippr?

    All seem to be doing in the $10-$100M in revenue a year.

    • Sean

      Huh? Companies doing $10m a year don’t go public. SEOMoz is doing 10-12m. All Star Directories is a cash cow that PE firms will like as a private company but won’t go public given how badly Quin Street has been hit by Google’s Panda algo change. Cheezburger is a good one. Wetpaint is doing some nice things but has changed business strategies a bunch — they’ll need another 2-3 years to prove out the strategy they have has legs before they can IPO. Avvo is also not going public. The legal market can’t sustain the type of ad sales that real estate can which is why they are changing strategies. WhitePages is profitable and could go out, but why would Alex do that to himself? He is keeping it under control, running it at a profit, and enjoying the dividends he can pay himself.

  • Anonymous

    John, why focus on consumer companies? Zillow has a market cap of $560 million and 250 employees. Isilon is valued at $2.25 billion and has more than 500 employees (I’m not referring to EMC). Geekwire has written about Zillow 33 times in 2012. Isilon got mentioned 4 times. Why the aversion to enterprise IT? Complexity? It seems like the venture and start-up community should be focused on opportunity and results.

    I think McIlwain and the WSJ are right that enterprise IT is the growth opportunity. Here are some companies (some public, some not) I’d love to hear more about in 2012
    – AWS
    – F5
    – Isilon
    – Cray
    – Concur
    – Watchguard
    – Parallels
    – OpsCode
    – Space Curve (shameless plug)
    – Other readers, please pile on

    • http://twitter.com/scottporad Scott Porad

      Paul, are you saying the VCs are averse, or just the media coverage?

      • Anonymous

         Media coverage. Geekwire isn’t alone. Look at Arrington, GigaOM, All Things D. It’s pervasive.

    • Guest

      It is easier to write about consumer companies.
      Isilon/F5 – need to spend sometime to learn about their technology – too hard.
      People are looking for low hanging fruits.

      • Anonymous

        Yes and consumer “hot topics” are proven to drive traffic. You want to fill your site with the search term of the moment. But as an investor or job-seeking engineer or developer, your opportunities may be far greater at F5 than at Big Fish. There’s a potential discussion about how the unnatural coverage on consumer start-ups skews industry focus. A topic I’d love to see Geekwire or xconomy take up.

    • johnhcook

      Thanks for the comment Paul. Appreciate the feedback. First off, Zillow has a market value of $847 million. Secondly, they naturally attract more coverage from us — yes, due in part to the nature of their business — but also for other factors. They were the ONLY tech company in this state to go public last year. They are trying to transform a very big industry. They remain an independent, publicly-traded company here in Seattle. Also, for whatever reason, online real estate is a sector that is deeply rooted in Seattle and because of that I follow that category closer than others, say semiconductors or biotechnology. 

      You make some fair points. But I’d argue that GeekWire actually does a better job than most of covering some of these b2b companies. (In fact, we’ve written about nearly all of those companies in the past year, including Space Curve (twice). Sometimes, the stories of b2b companies are harder to tell and make accessible to the general technology audience, but we are committed to doing so.

      Remember, we are a 2-person editorial shop running a 24-7 news organization. We triage everyday picking the very best stories we can — some offbeat and unusual and some hard-hitting. All of that said, if you have good stories to share about any of those companies or others, please email me at john@geekwire:disqus .com. We love tips and scoops — our bread and butter. I can’t promise you that I will cover Isilon — now a unit of EMC — more than Zillow.

      But I will take a look at any news story that I find of importance for this community.  We try to provide a diverse look at what’s happening in Seattle and beyond, telling stories that matter not only to business readers but general users of technology. (Consumers). This is one reason that GeekWire’s coverage skews more “consumery” as do most news sites. And to your follow-up comment, yes we do track page views and we like when more people read our stories. (Something that every media outlet since the dawn of time has been interested in). 

      But we don’t solely drive our coverage based on page views. If that were the case, I’d stop covering Seattle startups altogether and simply start writing about Facebook, Pinterest and Apple. Thanks again for the comment, and for tuning in to GeekWire.

    • Sean

      Dude? Do your homework. Isilon doesn’t exist as an independent company. Was acquired by EMC. Probably one of the best Seattle tech stories ever. I mean, there is Microsoft, Amazon, Expedia, and then Isilon I believe. 

  • Ding

    Vernon is not at Zulily anymore.

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