Startup Founders, Investors, and Bankers Offer Some IPO Guidance
Summary
The big local story so far has been Carlsbad, CA-based MaxLinear (NYSE: MSL), a wireless chip design company founded by CEO Kishore Seendripu, which raised almost $90 million in its IPO in March.San Diego’s Trius Therapeutics, which registered for a $78 million IPO in November, postponed its plans in March to conform its Phase 3 protocol for its antibiotic drug candidate, torezolid phosphate, to accomodate new guidance issued by the FDA.So what are the factors affecting IPOs, and what kind of guidance are San Diego’s experienced CEOs and other experts offering about taking startups public?Rather, he says it was a calculated decision driven mostly by MaxLinear’s senior executives and was based on their reasoning that corporate valuations had been beaten down by the recession, and would rise—much like Southern California’s residential real estate market.The level of predictability in financial reporting “is almost like being a Fortune 500 company,” Sweeney says, and Wall Street investors and analysts expect IPO candidates to show $100 million in annual revenue, no debt, and profitability.