MySQL Hits $50 Million Revenue, Plans IPO 124
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.""
Oh no... (Score:5, Interesting)
I don't like that. I like MySQL for what it is. Not what is can do with cash or depending on stockholders approval...
worrying (Score:5, Interesting)
This http://www.codinghorror.com/blog/archives/000842.
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.
So... When will Oracle or Microsoft buy them out? (Score:5, Interesting)
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.
Re:So much for them. (Score:5, Interesting)
Re:interesting timing for an IPO (Score:3, Interesting)
Re:interesting timing for an IPO (Score:3, Interesting)
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 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.'
Being acquired and going public are both things that bring a nice return for investors. There is nothing wrong with that in itself. But is that quick return coming at the expense of the entity that is MySQL or worse, the application itself?
Re:interesting timing for an IPO (Score:5, Interesting)
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
Re:interesting timing for an IPO (Score:5, Interesting)
'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.
Re:I Predict that (Score:2, Interesting)
If you care, like really care, about Open Source companies perhaps it would be a good idea to set up an open source investment "club" or fund to take a more serious stake in these companies. A Slashdot fund anyone?
You have other ethical funds these days (green, Islamic etc...) which invest according to additional criteria (I'm not suggesting an open source charity, the users get enough of that already) - why shouldn't we pool our resources and influence to help steer publicly traded open source companies?
This will allow you to get in before they go to open market IPO and take a good chunk of equity. Of course, you could start up an open source VC too for earlier stage (= more risky) investments and take a bigger chunk of equity (and the associated board-level activity)
Put your collective money where your collective mouth is.
(I don't work for MySQL)
Re:interesting timing for an IPO (Score:3, Interesting)
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 of the financial borg.
I've seen a lot of fast growing companies get gobbled up. Often companies want to merge because they think their existing structure can't keep up with the pace of the growth. I guess it is also common for companies to seek a merger when the market expectation of their growth outpaces reality (I won't go into that).
I am just sad that going public seems to be prelude of a tragedy of another great company being sucked into the merger game.
This world really needs ways for companies to be publicly owned yet remain independent. The two ideas are
Re:Capitalists = Evil (Score:2, Interesting)
Re:Capitalists = Evil (Score:3, Interesting)
Exactly! I'm living a real world example. The company I work for re-sells an accounting package tailored to the construction industry. We sell, train and do support for the product and we also work as an integrator developing client specific add-ons software that works with the product. The product itself was fairly good when it was introduced in the late 90's and there was a real boom during the run up to 2000 when companies dumped their legacy systems to move to Y2K compliant, Windows based software. As a result the vendor who created it kept being bought out by other larger and larger companies and resources kept being redirected from development until all that was left of the development staff was a couple of programmers kept on for maintenance purposes and it became clear the focus was riding the maintenance base for as long as possible on not on continued product development.
Basically no serious new development was happening or had happened for several years and the resellers were finding it harder and harder to make new sales. My company had a bit of sway since we were and still are consistently the best reseller in the country. We shifted from a sales and training operation to a support and consulting operation. Because the database back end was MS SQL Server we were and still are able to develop our own applications that could integrate with the base accounting package and we could work with third party companies to integrate their software with the base accounting package and as a result we were still able to sell the accounting software by showcasing all of the additional functionality brought about by the additional packages we had created and/or integrated. We were able to offer features above and beyond what most other software packages offered, even if the base accounting package was a bit cumbersome and out dated.
Almost two years ago a private equity firm bought out what had become the publicly traded company that owned the software in question and after deciding that there was more revenue to be made from the accounting package they put some competent managers in place. During our first meeting with them we showed them all of the software that we had developed in house and demonstrated all of the third party packages that we had integrated and told them that they were crazy not to open source the product to resellers so that we could extend the functionality of the package. We told them that as part of the license they could insist that we make any changes available to them so that they could include anything that was good in their original source code base to improve the program and increase sales revenue.
They were legitimately concerned about having to provide support for code they didn't write if a reseller who made changes went out of business but we explained to them that we would only make changes at a clients request and that we would be very upfront with the client and let them know that any changes we made wouldn't be supported by the original vendor, only by the us, and that we would work hand in hand with the development staff to make sure that any changes we made were understood by the development staff and that we'd work with them to integrate the changes into their code base to make it a part of the original package. After going over everything with their legal department the vendor in question finally agreed to try a pilot program with us and it's been a huge success! Within a year they opened to source code to all resellers with a development staff who had been resellers for three or more years.
Even though the software that we sell isn't the best package out their in terms of user interface, it's come a long