Shares in Everbridge, the Burlington-based provider of emergency communications software, opened on Nasdaq Friday morning at $12.30, a small increase from the company's initial public offering price of $12. This makes Everbridge the second Massachusetts tech company to begin trading publicly this year, following Acadia Communications.
As of Friday afternoon, Everbridge's stock price was up more than 20 percent at $14.59 per share.
"It is exciting to be the second tech IPO this year in Massachusetts," Ellertson told BostInno in a phone call from New York. "We’re excited about continuing the journey now. It’s just one step in a very long process. We really think the IPO gives us the first mover advantage in the market and it tells people in Boston we’re a great place to work."
The company expects to use its $90 million IPO in part to invest in sales and marketing in the United States and abroad, as well as research and development, according to an S-1 filing. It may also use a portion of the funds for acquisitions or strategic investments, though nothing is currently planned right now.
"We do believe we’ll be able to use vast majority of capital for strategic opportunities when they make sense from a share value standpoint," Ellertson said, saying any acquisitions would be done for the purposes of adding new products or adding customers in new geographic areas who the company would be able to up-sell or cross-sell other products.
Everbridge raised $90 million in the IPO by selling 7.5 million shares, with $15 million of that (1.25 million shares) going to insider shareholders, according to a regulatory filing. Credit Suisse and BofA Merrill Lynch were the lead underwriters.
The company's $12 IPO price set its fully diluted market value at $329 million, according to Renaissance Capital, Not bad for a firm that raised less than $15 million in venture capital, according to PitchBook data. Backer ABS Ventures, of Waltham, Mass., holds 31 percent of Everbridge shares. Ellertson is the next largest shareholder, with a 13.6 percent stake. Co-founder and board member Cinta Putra owns 10.6 percent.
Founded in the wake of the Sept. 11 terror attacks, Everbridge wasn't always an East Coast company. The company's headquarters was previously in California until it acquired CloudFloor, a Waltham-based company that Ellertson founded led, in 2011. As part of the acquisition, Ellertson, who had been a board member and investor in Everbridge before then, became CEO and most of the company's management team was shifted to Massachusetts.
Ellertson was previously CEO of Gomez, which was sold to Dynatrace in 2011; S1 Corp., which was a public company until getting acquired by ACI Worldwide in 2011; and Interleaf, which was public and then acquired by Broadvision in 2000.
"Our job is continue to build what we believe can be a very large business."[/pullquote]
For the company's financials, Everbridge posted $35.6 million in revenue for the first half of 2016 against a $6.2 million net loss, according to its S-1 filing detailing IPO plans. In 2015, it's revenue was $58.7 million, 38 percent more than the year before. Its net loss in 2015 was $10.8 million, a major increase over the $623,000 net loss it had from 2014.
While the company isn't profitable from a cash flow perspective, Ellertson said the company is focusing on delivering growth and adjusted positive results on EBITDA (earnings before interest, taxes, depreciation and amortization).
"Our job is continue to build what we believe can be a very large business and deliver value to our shareholders," Ellertson said of the company moving forward. "If we continue to deliver on growth and especially adjusted EBITDA positive results, I think the market is very efficient, and I think the stock market will take care of itself."
The systems provided by Everbridge, which trades under the symbol EVBG, are designed to locate employees and communicate with them even when normal communications systems, like cellular phones, are jammed or down. Its over 3,000 customers include city governments, airports, enterprises and other large organizations. Applications range from mass shootings and wildfires, to communications when cyber attacks have disabled other means.