Utah tech company Domo files to go public — with some concerns

Utah tech company Domo files to go public — with some concerns

(Courtesy of Domo)


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AMERICAN FORK — Local tech unicorn Domo filed to go public Friday, becoming the second in a slew of Utah companies that will step into the public sphere in the coming months.

Pluralsight became the first in mid-March when the cloud-based learning platform went public at an opening price of $20 — roughly 34 percent above the $15 price in the company’s prospectus.

Domo, however, might not bring the same type of buzz to the investment world.

The business intelligence and analytics company opened its books to the public, and though Domo’s revenue and international prospects are growing, the company is not yet profitable — though neither is Pluralsight.

Domo reported revenue of $108.5 million in 2017, up 46 percent from the year before, with a loss of $176.6 million, according to the company's S-1. Last year’s numbers were better than 2016, however, when Domo lost $183.1 million on a revenue of $74.5 million.

The American Fork-based company is also slightly short on cash after accumulating a $803.3-million deficit and $96 million in long-term debt as of April 30, with no more credit on which to draw. Domo currently has $71.9 million in the bank, which could take the company all of about six months to spend at its current rate.

Rumors surrounding a Domo IPO have been floating around the tech world for years now, but the company has often said it will go public at the right time. The company’s public offering comes at an opportune moment and may be its response to its rising deficit.

"If other equity or debt financing is not available by August 2018, management will then begin to implement plans to significantly reduce operating expenses," Domo said in its S-1 while discussing risk factors.

Domo believes funding from its IPO would allow the company to spend for about 12 months, but it will most likely have to raise more money in the future.

The company is currently valued at about $2 billion by private investors and has raised $730 million in venture funding — way more than most tech companies in Utah — with backing from Silicon Valley giants like Blackrock, Greylock and others, according to a Forbes report.

“No. 15 on the Forbes Cloud 100 list, Domo undoubtedly hopes to attract more large-size customers as a public company, while creating liquidity for early employees,” Forbes reported.

Despite lackluster cash numbers, Domo does have an impressive growth story.

Serial entrepreneur Josh James founded the company in 2010, just a year after he sold his other company, Omniture, to Adobe for $1.8 billion. Just eight years later, the Domo platform hosts more than 1,500 businesses, including 385 customers with more than $1 billion in revenue.

Domo’s platform pulls company data and creates visualizations that help executives and employees run and manage their business.

The company may be able to dazzle potential investors during its roadshow and drum up enough interest in the stock before it officially starts trading on the exchange.

If successful, Domo will join several international, national and local tech companies that are following the IPO trend. Qualtrics may be the next — and biggest — of the local tech companies seeking to go public.

Domo is currently observing a media quiet period and was not available for comment.

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