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Angie's List IPO raises $114 million

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Angie’s List Inc., the Indianapolis-based consumer-review service with more than 1 million paying members, raised about $114 million in its initial public offering Wednesday after pricing the shares at the top end of the proposed range.

The company sold 8.8 million shares for $13 apiece, according to data compiled by Bloomberg, after offering them for $11 to $13. Angie’s List will trade on the NASDAQ Stock Market under the symbol ANGI.

Angie’s List, which provides reviews of plumbers, electricians and other service providers, may benefit from the success of Internet peer Groupon Inc.’s IPO this month. The Chicago-based online-coupon leader raised $700 million Nov. 3, 30 percent more than it sought, after pricing the shares above the marketed range. The stock surged 31 percent in its trading debut and is up 20 percent since the IPO.

At the midpoint price of $12, Angie’s List would be valued at $667 million. Revenue at Angie’s List increased 46 percent, to $62.6 million, in the nine months ended Sept. 30, compared with the year-earlier period, the filing shows. Its net loss widened to $43.2 million from about $19 million.

The company planned to sell about 6.3 million shares in the offering, with the remaining 2.5 million sold by existing shareholders, according to the prospectus. Battery Ventures had planned to reduce its stake to 15 percent from 18 percent, while BV Capital was paring its stake to 9.3 percent from 12 percent. Company co-founder Angie Hicks planned to trim her stake to 1.5 percent from 1.8 percent, the filing shows.

Angie’s List plans to use net proceeds from the offering to fund advertising and increase membership, the filing shows. Bank of America Corp. led the offering.



 

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  • Real world
    $32.5M in their pockets? That's what the check was written for but with an option price of $8/share, they had to write a check for $20M at some point. What start-up company that is VC backed doesn't have huge losses in their early years? The $160M is painful to see, but with a company such as this, it takes so much capital to get off the ground, the figure is not surprising. The valuation is not based on what happened in 2006. Can you provide more detail on your CF model that will have them out of cash in 24 months? Are you taking into consideration the doubling of their subscription base in the last year and the idea that will double again in the next 18 months? And how much cash will be going out the door for the goodwill write-downs? Give me a glimpse of this real world you live in so I can be better educated in my investing.
  • "Cash and Non-GAAP income are the keys"
    Insiders immediately cashing out 2.5 million shares at $13 is $32.5 million in their pockets.

    Insiders lost $43.2 million through the first nine months of 2011, pushing total losses since 2006 to $160.6 million.

    At that cash burn rate, the company will be out of cash within 24 months, after the insiders have dumped their stock options/shares and the "goodwill" writedowns begin.

    Using non standardized accounting rules to measure financial performance and taking cash from clueless investors is not key.

    We live in different worlds. Mine is real.
    • Pump and dump?
      So 2.5M shares were put in the pot as a part of the greenshoe means "everyone" is selling out? How many shares were outstanding? I'll save you the few minutes of your precious time, 2.5M shares is less than 7% of the total outstanding and very common pre-IPO activity to guide the price in the direction the company is targeting.

      In terms of turning a profit, just look at I3, Aprimo (never completed but did file initial paperwork several years ago), Groupon, Pandora, LinkedIn, etc. None of these companies were profitable other than LinkedIn which was just above water. Cash and Non-GAAP income are the keys.
    • Greater Fool Theory
      "The company sold 8.8 million shares for $13 apiece, according to data compiled by Bloomberg, after offering them for $11 to $13.

      The company planned to sell about 6.3 million shares in the offering, with the remaining 2.5 million SOLD BY EXISTING SHAREHOLDERS, according to the prospectus."

      "in terms of turning a profit, that matters very little with a technology IPO."

      What world do you live in?

      Must be the one that valued AOL stock by the number of internet hits it received;)

      Pump and dump.
      • How?
        How is everyone selling? Are they not held to the six month SEC mandated holding period? And in terms of turning a profit, that matters very little with a technology IPO. Check Interactive Intelligence, they weren't turning a profit when they filed and the other IPO mentioned in this article, Groupon, they aren't turning a profit. Cash is king and so are trends such as Angie's # of new subscriptions which has doubled in the last year and a 5% increase in renewal rates. According to the S1, the S&M expense increase is fully driven by adding over 120 new sales people and doubling their nationwide advertising. Both of which are trends which will settle as revenue takes off which is a great sign for a company with a relatively low number of shares outstanding.
      • Greater Fool Theory
        Red Flags Everywhere:

        Everyone connected with the company is selling.

        Never turned a profit.

        Doesn't even project to be profitable in the future.

        Who the heck is buying shares in this company?

        • really?
          I have some land to sell you in Florida....

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