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Businesses The Almighty Buck

MySQL Hits $50 Million Revenue, Plans IPO 124

Posted by samzenpus
from the they-grow-up-so-fast dept.
An anonymous coward writes "MySQL, purveyor of the open-source database of the same name, is on the road to becoming a publicly traded company, bolstered by $50 million in revenue in 2006. "It's still in the pipeline," Chief Executive Marten Mickos said of the plan to hold an initial public offering of his company's stock. He declined to discuss when the company planned to go public, but said, "We're making good progress, doing all the things we need to get done.""
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MySQL Hits $50 Million Revenue, Plans IPO

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  • by Anonymous Coward
    The NYSE symbol is MyDIK. You can pump and dump this stock all you want. It has more uptime than MySQL.
  • by ushering05401 (1086795) on Wednesday April 25, 2007 @11:41PM (#18880269) Journal
    I wonder if Google is planning to leverage MySQL in a proxy warfare type scenario vs. M$.

    The contention between the two giants has been heating up, and MySQL is steadily gaining ground on SQL Server for marketshare.

    Couple that with Google's recent contributions to the MySQL project and statements by one of thier engineer's (Callahan?) that they would continue to enhance the DB & pump the code back into the community... focusing on stability, recovery, and fine tuning code.

    Looks like Google could be contending with M$ on at least three fronts soon counting search, office, & now DB's through MySQL.

    I want to see them rumble. The timing of this IPO is very interesting.

    Regards.
    • by martenmickos (467191) on Thursday April 26, 2007 @12:31AM (#18880575)

      Thanks everyone for the comments! Let me first note that there was no specific news item in the article referred to at the top. We have had plans for IPO for several years. We don't see an IPO as an end-goal, but as a natural step in the evolution and growth of MySQL.
       
      As many of you will know, when a company brings in venture capital (VC) as we did 6 years ago, you essentially set a plan to either be acquired or go public (IPO) after some time. We think that MySQL is a great business and one that can and should be independent and do an IPO at some point.
       
      We share a passion for open source business - i.e. a passion to demonstrate what great businesses you can build on open source. And we want to provide the best database developers with great rewards: the good feeling of producing a product that changes the world, and the financial reward that comes with business success.
       
      We have numerous users and customers ask us about buying MySQL stock. Today we are privately held and there are no shares for sale, but once we go public anyone can buy shares in our company. And being a public company we will have more strength to grow, to hire more great developers, and to serve new customers.
       
      Does this make sense to you? It does to us.
       
      Marten Mickos, CEO, MySQL AB
      • Re: (Score:3, Interesting)

        by pembo13 (770295)
        How will you deal with the the business aspects that come into play when a company goes public that we geeks fear; things like being bought out by "more evil" companies?
        • by martenmickos (467191) on Thursday April 26, 2007 @01:44AM (#18880927)

          Here is my quick view of risks with going public, and how we are dealing with them:

          Risk of being bought out. - The best protection against this is fast growth. If a company doesn't grow, then it is at risk of being bought no matter whether it is private or public, large or small. (So if you want to contribute to us - then refer us to as many paying customers as you can!)

          Risk of company culture becoming too corporate-like. - We try to avoid this by being very focused on cultivating our unique values. We add more structure and more procedures all the time, but we also try to stay free from bureaucracy and we always encourage our employees to make bold decisions.

          Risk of openness being at risk as a public company. - We make sure that all our investors (current and future) understand that the freedom of our software is vital to the success of MySQL. We also try to be open about everything else: bugs, plans, events, etc. But here we also know there will be something of a difference when going public: we will have to abide strictly by SEC rules and not disclose financial or other vital business information in any other way than publicly to everyone at given points in time.

          Feel free to list more risks and I will be happy to address them.

          Marten
          • Re: (Score:3, Interesting)

            by yintercept (517362)

            On the comments about timing ... ah, it seems that companies want to go public when the market is going up... Rarely does a company want to go public right after a crash. Financial events often coincide because people make decisions based on financial stimulus.

            I like the idea of an open sourced company being publicly owned. I have to admit, my fears are that the bureaucratic mindset that dominates the insurance companies and mutual funds that own this world will force another great company into mediocrity

          • by alienmole (15522)
            It seems to me that on the buyout risk issue, MySQL would be a pretty strategic acquisition for a number of companies that could afford to buy it without really blinking, so do you really think that fast growth will protect you from that? Besides, fast growth brings its own set of problems.

            I wish you luck with this, but I have to say my experience with RedHat soured me on this sort of thing. They basically did everything they legally could to make their source effectively inaccessible to users that hadn't
      • Re: (Score:2, Insightful)

        It seems like a good amount of concern about gong public revolves around shifting control.

        Are there any business practices that you guys avoid that might be more difficult to avoid after going public?

        Egregious VaporWare (or at least totally premature) announcements occur to me as a stockholder appeasing move that a lot of public companies make. Any opinion on this?

        Regards and good luck.
      • Re: (Score:3, Interesting)

        by shaitand (626655)
        As a public company you will have to answer to the typical pump and dump investor that typically buys publicly traded stock. These people favor moves that yield increased stock price over long term strategies that result in both a stronger company and a stronger product. How do you intend to avoid this change?

        As a publicly traded company, how would you avoid a hostile takeover by a company like Oracle who has the means to buy a controlling share of the stock?

        'As many of you will know, when a company brings
        • by martenmickos (467191) on Thursday April 26, 2007 @01:57AM (#18881001)

          For part of your questions, see my response to another question on this thread:
          http://slashdot.org/comments.pl?sid=232285&thresho ld=0&commentsort=0&mode=thread&pid=18880831#188809 27 [slashdot.org]

          And here comes more risk analysis:

          Risk of "pump and dump" investors driving MySQL strategy in the wrong direction. - Naturally a company will have to follow the instructions from its shareholders, but we believe that we have and will have strong and long-term investors who understand the value of strategic resilience. These investors will encourage us to invest in what gives the best value over time.

          Risk of quick return to investors negatively affecting the MySQL entity or application. - I actually believe the opposite - that a successful IPO for MySQL will give us a boost in innovation and development. I believe that as a public company MySQL would attract even more innovative partners and brilliant employees.

          Marten

          P.S. I can of course be wrong in my risk assessments here and in other responses on this thread. That's why I post them for all of you to read - in the hope that you will provide your feedback and suggestions.
          • by shaitand (626655) on Thursday April 26, 2007 @03:01AM (#18881351) Journal
            Thank you for responding. The fact that you are engaging in an open communication with the community like this is probably a greater comfort than the actual answers you give. That said, I have always been good at poking holes in debates.

            'Risk of being bought out. - The best protection against this is fast growth. If a company doesn't grow, then it is at risk of being bought no matter whether it is private or public, large or small. (So if you want to contribute to us - then refer us to as many paying customers as you can!)'

            That certainly makes sense. Is there any assurance that such growth will occur? Is there more to this move than a spin of the roulette wheel coupled with a great deal of optimism about the outcome?

            Oracle already knows they want to purchase MySQL. Is there any way to protect the company if they move to make that purchase right away without giving the company a chance to grow?

            'Risk of company culture becoming too corporate-like. - We try to avoid this by being very focused on cultivating our unique values. We add more structure and more procedures all the time, but we also try to stay free from bureaucracy and we always encourage our employees to make bold decisions.'

            I can't really poke a hole in that. But would like to remind you; Google had a 'do no evil' policy as well. That policy and greed battled within the company and in the end, greed won.

            'Risk of openness being at risk as a public company. - We make sure that all our investors (current and future) understand that the freedom of our software is vital to the success of MySQL. We also try to be open about everything else: bugs, plans, events, etc. But here we also know there will be something of a difference when going public: we will have to abide strictly by SEC rules and not disclose financial or other vital business information in any other way than publicly to everyone at given points in time.'

            Do you mean to suggest that bug reports and other things that concern the community will only be released in SEC filings? Surely not, companies release information that concerns their business through the press and other outlets all the time.

            'Risk of "pump and dump" investors driving MySQL strategy in the wrong direction. - Naturally a company will have to follow the instructions from its shareholders, but we believe that we have and will have strong and long-term investors who understand the value of strategic resilience. These investors will encourage us to invest in what gives the best value over time.'

            Isn't this nothing but pure optimism? Anyone can purchase the stock. Are MySQL public stockholders likely to share the same characteristics as the stockholders of most companies?

            'Risk of quick return to investors negatively affecting the MySQL entity or application. - I actually believe the opposite - that a successful IPO for MySQL will give us a boost in innovation and development. I believe that as a public company MySQL would attract even more innovative partners and brilliant employees.'

            Don't many of those investors play key roles in MySQL today? Isn't there a good chance that many of those individuals will use this as an opportunity to cash in? Also, increased financial resources does not equate to superior results. Microsoft is probably the most typical example of this.

            'P.S. I can of course be wrong in my risk assessments here and in other responses on this thread. That's why I post them for all of you to read - in the hope that you will provide your feedback and suggestions.'

            Good luck Mark. I'm sure having you at the helm of the company gives everyone comfort, I know it gives me comfort. I wish you and MySQL the best and hope going public works out for you.
          • by Ngarrang (1023425)

            Risk of "pump and dump" investors driving MySQL strategy in the wrong direction. - Naturally a company will have to follow the instructions from its shareholders, but we believe that we have and will have strong and long-term investors who understand the value of strategic resilience. These investors will encourage us to invest in what gives the best value over time.

            Shareholders not employed the company rarely have anything but dollar signs in their eyes and only care about their own short-term gains. I have watched a lot of tech companies go public since 1990 and many of them are gone now. Bought out, sold out, sued out of business, or mis-managed by chief's who's only concern is their own wallets. And when that happened each time, only the chief's escaped with any money, leaving the employees with nothing but a resume entry.

            Without using management-speak, plea

      • How do you view the risk of Oracle buying you out? It seems that they bought InnoDB to fight the growth of MySQL since it takes MySQL one step closer to enterprise level DB. With the IPO, they could just buy you guys outright and put an end to a large part of the open source DB threat. I guess in that case we can always fork...

        Best of luck! You guys are amazing.
      • by mwvdlee (775178)
        Why would anybody want to IPO?

        In practice it does two things:

        1. Temporarily boost financial resources.
        2. Lose all control over your own company.

        The financial boost is nice, but rarely necessary and I assume most people care about the company they built and wish to have it's values and culture remain intact.
        • by martenmickos (467191) on Thursday April 26, 2007 @02:45AM (#18881251)

          I must say I disagree with your analysis of IPO. But let's first back up. It was in 2001 that the founders of MySQL decided to get venture capital on board and to go for business growth and an IPO or an acquisition in the future. I don't know if you were around back then, but that would have been the right time to ask why the founders wanted an IPO.

          Then to your analysis. I believe that an IPO has the opportunity to boost your financial resources for a very long time. I also believe that you don't have to lose control over your company. Control is lost (in my mind) if and when a company stops to grow - no matter whether the company is public or private. Even if you own all of a private company - if it does not grow then you don't have too many options as to how to run it. So although you may not have lost control to another shareholder, you have essentially lost control to the circumstances.

          And then there are other benefits of IPO. It gives you a currency for making acqusitions. It gives you exposure and typically add to your credibility among conservative customers. And it can be highly inspirational for the employees.

          Make sense?

          Marten

          • by chthon (580889)

            Isn't the problem with growth, that eventually you will reach a ceiling, unless you are able to drive out competitors, in which case you become a monopoly ?


            • Thank you for assuming that we will reach that level!
               
              Seriously, sure that can be an issue, but getting there takes 20-30 years in the software industry. In the meantime the world will evolve and there will be some new entrepreneur with a revolutionary way to manage data, and that will be the growth story, and whoever is the huge leader at the time will have to deal with this.
               
              Marten
          • Control is lost (in my mind) if and when a company stops to grow - no matter whether the company is public or private.

            Then you're either using a different definition of 'control' to everyone else, or you're waffling.

            Even if you own all of a private company - if it does not grow then you don't have too many options as to how to run it.

            If you own 51% of the company, you have the same amount of control whether its [revenues|market share|any other measure] doubled, stayed the same or fell by 25%.

            • by Dunbal (464142)
              If you own 51% of the company, you have the same amount of control

              It's 50% plus 1 share, not 51%. In a publicly traded company with potentially billions of shares, it makes a HUGE difference.
              • It's 50% plus 1 share, not 51%.
                Unless the company has less than a hundred shares, won't 51% be more than 50% plus one?
                • by Dunbal (464142)
                  Yes that's my whole point. To have control you need 50% plus 1 share. So a company with 1 BN shares means you need 500,000,001 shares in order to control it. The person I responded to said 51% for control which is not true. And 500,000,001 (50% plus 1 share)is a lot less than 510,000,000 (51% of shares).
                  • Yes that's my whole point. To have control you need 50% plus 1 share.

                    Very nice, quite correct - and totally irrelevant because that wasn't my point. My point was 51% would give you the same amount of control irrespective of the size of the company or the trend of the size. You even quoted that statement - did you read it? 51% is an arbitrary number greater than half. The same would be true if I'd written 73%, 67% or 99%.

                    In other words, the statement by martenmickos that "Control is lost (in my mind) if

          • by asc99c (938635)

            Control is lost (in my mind) if and when a company stops to grow

            Companies don't need to grow. If it's a profitable company at it's current size, there's nothing wrong with that. The problem is more usually after a burst of growth, a company suddenly finds it has outgrown it's market. It's easy to quickly sell large volumes of shiny new shrink wrapped software. Following that you need to hire a bigger support team and hope the money you made selling the boxes covers support costs, or that you can keep selling more copies. If you've just grown quickly, that's a calc

          • Even if you own all of a private company - if it does not grow then you don't have too many options as to how to run it.

            Eh? How so?

            I own my own small business and it's been about the same size and doing about the same thing for the past fifteen years, and will continue to be about the same for the next fifty years (or at least I hope it does.)

            I do what I want to do, when I want to do it. And I get to make a living doing what I like to do.

            How does that translate to a lack o
    • I wonder if Google is planning to leverage MySQL in a proxy warfare type scenario vs. M$.
      No way. Google are smart. Very smart. Some of their people have degrees I can't even spell. If that were their strategy, they'd have gone with Postgresql.
  • Oh no... (Score:5, Interesting)

    by C_Kode (102755) on Wednesday April 25, 2007 @11:45PM (#18880311) Journal
    Mickos said. "And by going public you get the currency to do acquisitions."

    I don't like that. I like MySQL for what it is. Not what is can do with cash or depending on stockholders approval...
    • Re:Oh no... (Score:5, Insightful)

      by kestasjk (933987) on Wednesday April 25, 2007 @11:56PM (#18880393) Homepage
      Maybe if they were a public company with some cash they would have been be the ones to buy InnoDB, instead of Oracle.
    • Re: (Score:2, Insightful)

      by Omnifarious (11933) *

      This makes me all jittery too. I have very little trust of public companies. I think the laws surrounding them are in need of even more serious reform than they've gotten so far (SOX and HIPPA being examples of laws that bring back some accountability).

      But, the other person to reply made a really good point about InnoDB. This may not be all bad. And realistically, if it turns bad MySQL can be forked.

    • Re: (Score:2, Insightful)

      by Valar (167606)
      Hate to break it to you, but MySQL is already run by stockholders... just because it isn't _publically_ traded doesn't mean their aren't owners who control have an equity stake. Those owners had the same interest in enhancing the company's revenues as purchasers of stock would. And since realistically the public stock holders don't control day to day operations (i.e. engineering), I doubt you'll see a drop in product quality just because all of the sudden you can buy stock in the company.
      • Re:Oh no... (Score:4, Insightful)

        by Omnifarious (11933) * <eric-slash&omnifarious,org> on Thursday April 26, 2007 @02:24AM (#18881125) Homepage Journal

        There's something about the diffusion of responsbility involved in a company being public that tends to cause such companies to become inordinately rapacious and evil. All the decision makers can point to the fact that they're 'morally' obligated to do whatever it takes for the company to make as much as it can for stockholders. And the stockholders have a really hard time getting together to tell the company that some actions are just too far.

        But when the number of stockholders is smaller and known, their sense of personal responsibility and morality can be appealed to, and they're more likely to pay attention to it regardless.

      • Re: (Score:2, Informative)

        There's a world of difference. In a private company, the stock isn't publicly tradeable. This single fact is enough to strongly deter pump-and-dump and other forms of short-term thinking.
  • worrying (Score:5, Interesting)

    by f1055man (951955) on Wednesday April 25, 2007 @11:53PM (#18880373)
    This worries me. I don't think the street's interests match up with open source communities or the private companies that make a living off of them. The street likes bold moves for short term gains. OSS demands slow(usually) organic growth and consensus building. A MySQL controlled by arms-length investors might throw an error, how will Mickos catch?

    This http://www.codinghorror.com/blog/archives/000842.h tml [codinghorror.com] comes to mind.

    If they offer a second class of shares(dividends but no voice) then maybe it will work, but I'm not sure there's a point in it.
  • by asphaltjesus (978804) on Wednesday April 25, 2007 @11:55PM (#18880389)
    This is not a dig at the folks at Mysql.

    It is a warning to everyone who thinks that mysql will be immediately better for going public.

    In my finance class I learned that the best way to grow a company is on revenues. Second best is private equity. Near the bottom of the list is public equity.

    It's probably the case that Mysql's early investors are looking for their pay day. That's fine, but I'm more concerned about the long term effect of being a public company on the quality of mysql product.

    The clever slashdotter with a little cash to gamble with should buy some mysql hold it for a year and dump it. They should come out ahead and be getting out while the picture looks rosy.

    Food for thought.
    • by Valar (167606)
      Revenues are fine, but they are sort of dictated to you-- you make as much profit as you can. Private equity is great, if you can find it. For young businesses, you just go to your cousin or friend or somebody and ask them if they want to own half the company you are starting. At MySQLs level, they would have to seek out either VC Firms (which are arguably worse than public trading, since they try to micromanage your operations) or industry firms interested in acquiring a piece (which is bad, because any su
    • by mpcooke3 (306161)
      The clever slashdotter with a little cash to gamble with should buy some mysql hold it for a year and dump it.

      Yeah hold onto it until Larry Ellison buys it which, let's face it won't be long!
  • by WarlockD (623872) on Thursday April 26, 2007 @12:03AM (#18880417)
    I mean seriously, remember how much Oracle is being a dick when they bought PeopleSoft? And now MySQL with "only" $50 million in revenue is going IPO?

    I mean hell, remember this [com.com]? A private firm can turn down an offer, but a full public company has to go to its shareholders.

    Its not about the software, its just that MySQL is a nice company that worked hard to get where it is. I just don't want to see it get destroyed because they just needed a bit more capital.
  • by jkrise (535370) on Thursday April 26, 2007 @03:59AM (#18881653) Journal
    MySQL is today what it is and where it is, because of the quality and utility of the code it's putting out in the database world. People who invest in MySQL, the product do so because of it's suitability and superiority; not because of the financial reputation or stability of the company itself.

    By going in for an IPO, Mr.Marten Mickos may be right in that the company will be flush with funds, but then, people will be able to invest in MySQL, the company -- without caring for MySQL, the product or service or technology. Even companies like RedHat making over a billion dollars a year face enormous challenges everyday, in staying loyal to their philosophies and the customers; and avoiding takeovers by unprincipled thugs of all hues in the share markets.

    If Mr. Mickos thinks the company is going to get more business because it will now be a public firm, I think that optimism is misplaced and will be short-lived. That new business is going to come from MySQL's reputation of being a public company, not based on the technological superiority or suitability about the product. Should MySQL indeed care for such customers, given that the current mindshare and marketshate has come from the Open Source loving community?

    No one can prevent a firm from having an IPO, but I would be very surprised if MySQL can resist a takeover for even 12 months from the IPO. What that would do to employee morale which Mr. Mickos talks about, remains to be seen.
    • by petrus4 (213815)
      Should MySQL indeed care for such customers, given that the current mindshare and marketshate has come from the Open Source loving community?

      Let me guess...You'd probably be offended if in response to this, somebody accused you of Communist inclinations, wouldn't you? ;)
    • Re: (Score:3, Funny)

      by Bodrius (191265)
      Let me see if I understand...

      That new business is going to come from MySQL's reputation of being a public company, not based on the technological superiority or suitability about the product. Should MySQL indeed care for such customers, given that the current mindshare and marketshate has come from the Open Source loving community?

      You're suggesting that a for-profit business refuses to serve new paying customers... because they're 'n00bs'?

      What is this, the Soup Nazi school of open source business?

    • by MoreDruid (584251)
      Yes, but since the MySQL codebase is Open Source, there is no-one holding the community back for taking that code and extending it. Yes a fork like this can be painful and senseless, but even if MySQL is bought out, it's the company that's bought out, not the code. I think this is a very important distinction and one that has been evaluated by Mr. Mickos and his team. There is no-one stopping a developer from leaving the company once it goes against his ethics and starting a fork with the existing codebase
  • YAY..I mean yay....hmmm...whatever. MS SQl server allows people to connect to their database for free! MySQL not so much. As a large and repeated commercial user of the database (boo hiss) I can honestly say that my experience with them has been bad enough to not recommend them to commercial clients...hence we build our own MySQL from the "good branch", and let them use that. I just make sure that when they IPO and the big boys take notice they realise the legal mine field that the GPL brings to the tab
  • from all those cash infusions* from microsoft, Baystar, and Royal Bank of Canada.
    I expect the 60 million got invested into the pump-n-dump also, so there should be
    plenty to stick in MySQL's G-string.

    [*]
    http://uk.builder.com/0,39026540,39338281,00.htm [builder.com]
    http://www.mysql.com/news-and-events/news/article_ 948.html [mysql.com]
    http://slashdot.org/article.pl?sid=03/05/19/105522 3 [slashdot.org]
    http://news.zdnet.com/2100-3513_22-5057033.html [zdnet.com]
    • by petrus4 (213815)
      It's times like these when I wish I had mod points, to sink this kind of rubbish into oblivion where it belongs.

      Be gone, troll.
  • MySQL is the poster child for open-source RDBMS (sorry Firebird, sorry Postgres), and if nothing else, buying MySQL stock will eventually get you some Google shares when they inevitably absorb.

    -BA

    • by lucifron (964735)

      MySQL is the poster child for open-source RDBMS (sorry Firebird, sorry Postgres)
      Yup, MySQL is the IE of databases; good enough for the ignorant masses, and about as standards-compliant.
      Should you ever want to port your app, or just learn to use a different RDBMS, you'll have a lot of extra grief to overcome.
      • which is why I don't use it. We use Oracle here, and I've written for Sybase and DB2 in the past. I can't bring myself to use MySQL, it's still half-baked in all the parts I need.

        -BA

  • I have a question and a comment, first how much of the code base is made up of other GPL projects?

    If the answer is none then all you have to do is think about it for a second and you will realize that at any time the shareholders could take over and make it closed source, what's stopping them. Maybe this is the reason why they are going public, the lack of other GPL code means they can close it at anytime and start charging for it and maybe this is the reason other open source projects have never gone p
  • How did our economy shift so that being "bought out" or becoming a publicly traded corporation became the end-goal for entrepreneurs? At one time people, like say Henry Ford, fought tooth and nail to keep their companies from becoming publicly traded corporations or being "bought out".
  • As many of you know, Oracle bought the two transactional engines that MySQL use, namely, InnoDB (by InnoBase) and BDB (by Sleepycat).

    Although the effect on the GPL version of MySQL is negligible, the possible effect on MySQL AB as a company cannot be ignored. Remember that MySQL AB licenses its database to enterprise customers under a non-GPL license, and now Oracle holds the proverbial sword.

    First, MySQL bought solidDB [baheyeldin.com], then started developing the Falcon transactional engine in house, which shows promise,

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