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June 17, 2016

AppDynamics hire Goldman Sachs & Morgan Stanley to prepare for IPO

News: Software company could be valued at around $1.9bn.

By James Nunns

AppDynamics is reported to be preparing for an initial public offering after hiring Goldman Sachs and Morgan Stanley as lead underwriters.

The banks are helping the software company to draft an IPO filing that is due to be sent to the Securities and Exchange Commission, according to WSJ.

If the reports are true then AppDynamics will be one of only a few tech companies that have decided to go ahead with an IPO in 2016. The volume of tech IPOs this year has fallen 77% from the same period last year and it is the slowest year since 2009, according to Dealogic.

The reason for the slowdown has been attributed to the disappointing performance of some of last year’s tech IPOs, as a number of start-ups fell short of their valuations.

AppDynamics will be hoping to buck this trend and surpass its valuation of $1.9 billion, which was made in a November 2015 funding round.

The software company already has a wide range of investors from venture-capital and private equity firms such as Greylock Partners, Lightspeed Venture Partners, Goldman Sachs, Adage Capital, Industry Ventures, and General Atlantic.

The company provides a platform for unified monitoring, and application analytics to help assist with application performance management.

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One of the main products that it offers is an Application Intelligence Platform that the company says will help to accelerate a company’s digital transformation. The platform offers end-user monitoring, application performance management, infrastructure visibility, and application analytics.

It is unknown what the actual valuation of AppDynamics will be but it is likely to be around the $2bn mark. Valuations of private start-ups of over $1bn have significantly increased in recent years, rising from 149 from 45 at the beginning of 2014, according to Dow Jones.

Twilio, a communications start-up from San Francisco is expected to put in an IPO soon, with a valuation range of around $1bn.

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