It's been a breakout year for Boston tech thanks to a string of high-profile IPOs from Wayfair, HubSpot and Care.com. CyberArk Software and Imprivata also went public, giving the region five venture-backed tech IPOs this year (versus zero in 2013).
But that was yesterday's news. The big question now is whether Boston tech can keep up the momentum.
I see some indications that it can. Here are seven of them.
I based these picks largely on three things — revenue, revenue growth pace and whether I’ve heard that the company has IPO ambitions (either directly or in “word on the street” fashion). The fact that many of the companies have recently received investments from late-stage/pre-IPO investors also didn't hurt.
Actifio
It’s a "when" not "if" IPO question for this data storage technology firm. Actifio’s business appears to be booming (vexing legacy players such as EMC); it was valued at $1.1 billion as of its $100 million round March; and CEO Ash Ashutosh told me the company would like to go public some time in mid to late 2015.
Acacia Communications
Word is that this networking technology company is IPO-bound, though I haven’t heard a timeframe specified. Judging by the firm’s size and growth pace, though, Acacia looks like it would be a contender for 2015; the firm saw astounding annual revenue growth between 2010 and last year, from $374,000 to $77 million, placing it at No. 5 on this year’s Inc. list of fastest-growing companies.
Veracode
CEO Bob Brennan said firm’s $40 million round in September is expected to be the last before the cybersecurity firm pursues an IPO, potentially within the next year. Revenue last year surpassed $45 million, and the company sees no shortage of growth opportunities amid the ever-growing list of cyber threats out there.
Digital Lumens
The maker of energy-saving, software-driven LED systems for commercial and industrial settings has been quietly growing into a major player in Boston tech (even as a series of cleantech firms have folded). While I haven’t heard specifics on revenue, word is that the company isn’t too far off in size from recent cleantech IPO firms, such as Opower, and is interested in going public; a recent investment from Goldman Sachs would seem to support the possibility that an IPO could be in the works.
Acquia
The company, which offers cloud services for users of Drupal, reached $68 million in revenue in 2013, and its tally for 2014 should fall somewhere between $90 million and $110 million, CEO Tom Erickson told me. It’s possible Acquia will look to go public in 2015; “we’re certainly big enough,” Erickson said. The company has plenty of cash, however—along with strong revenue results, it completed a $50 million funding round in May—so there’s little pressure to go public from a fundraising perspective.
Next Step Living
Along with Digital Lumens, this energy efficiency upgrades firm has become a standout success story in Boston cleantech—growing to nearly 600 employees in just six years in business. Word is that an IPO is a goal, and the company’s growth would seem to back that up: Next Step Living saw $58 million in revenue last year and is on track to double that this year, COO Brian Greenfield told me recently.
CarGurus
For this one I rely on the reporting of others: The used cars site, launched and led by TripAdvisor founder Langley Steinert, expects to generate nearly $50 million in revenue this year and is aiming for an IPO in 2015, according to a Fortune report.
So... no DataXu, Bit9, Fiksu or Rapid7? Yes, all of those companies have discussed going public in the past. But companies in the ad tech sphere (DataXu, Fiksu) will be tough to take public after the shellacking that ad tech stocks, such as Millennial Media and Tremor Video, have taken this year. And for security software firms Bit9 and Rapid7, I just don’t have a good sense of how large their business is right now or how fast they’ve been growing.
In any case, stay tuned.
