14 DAY TRIAL // With the weak economic conditions, initial public offerings (IPOs) experienced a nine-month drought period but things are apparently looking up as several IPOs were made just in the last few weeks. The latest, LogMeIn Inc., a company based in Woburn, Mass., will become the fourth in a six-week time frame and is set to begin trading at $16 per share.
LogMeIn will start trading under the LOGM ticker and has raised $107.2 million from its 6.7 million shares made available, according to the Wall Street Journal. Of those only $80 million will go to the company as the rest was traded as stock by the shareholders. The company is expected to keep an additional 21.4 million shares after the IPO putting its value at $342 million. LogMeIn was funded in two $10 million rounds of venture capital by a number of investment firms owning close to 50 percent of the company, which makes their collective share now worth $155 million.
While the future is looking up for venture-backed companies, Q2 2009 was one of the worst periods for venture capitalists, according to a Dow Jones report, with venture-backed liquidity declining 57 percent year-over-year, to $2.8 billion from $6.48 billion in the same period in 2008. The sums paid for these types of companies also fell in Q2, by 46 percent, from a median of $41 million in 2008 to $22 million today.
However, three other venture-backed enterprises made their IPOs in the last weeks, raising an accumulated $232 million. "The IPO window appears to be opening as the first three public offerings since the third quarter of 2008 closed in the second quarter," said Jessica Canning, director of global research for Dow Jones VentureSource. "The success of these transactions is clearly a testament to the strength of these companies and their ability to close deals in current market conditions."