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Copyright © 2001, Simplex Solutions, Inc. 1
Going PublicWhether and How
Penny Herscher
October 3, 2001
Copyright © 2001, Simplex Solutions, Inc. 2
• Simplex story
• End in mind• IPO Checklist• Preparing• Going public• Follow up – life as a public company
Copyright © 2001, Simplex Solutions, Inc. 3
Simplex story
95 96
CompanyFoundedwithVC $
CEO hired
01
IPO Announce2nd major technologyplatform
97 98 99
1st productships
Mainstreamversion of1st productfamily
Ahead of the market
00
AcquireAltius &File S-1(on thesameday)
AcquireSnaketech
Market rapidly growing
Copyright © 2001, Simplex Solutions, Inc. 4
Results so far…
Simplex Revenue
June qtr
Copyright © 2001, Simplex Solutions, Inc. 5
End in mind
• Three choices– Technology – to be acquired– Product – grow revenue, then be acquired– Company – built to last, multiple product lines
• Drives all other subsequent decisions– All money is not equal– People investment– Strategy– Risk / reward profile
• Drives investment in infrastructure– Channel, financial systems, HR systems etc.
• IPO is not the end in mind– Funding step along the way
Copyright © 2001, Simplex Solutions, Inc. 6
IPO Checklist
• People– Executive team in place– Board in place– Motivation understood– CEO/CFO bandwidth
• Business– Backlog and visibility excellent– Customer reference strong– Product strength– Business model established– Channel in place
• Strategy– Vision, mission, purpose– Long term growth plan– Allies behind you
• Process– Finance processes in place– Stock admin in place– HR processes in place
Copyright © 2001, Simplex Solutions, Inc. 7
• Select bankers– Quality analyst coverage– Banker experience in EDA– Banking relationships
Preparing
Copyright © 2001, Simplex Solutions, Inc. 8
• File -> Final filing– Be prepared to spend time– Time, time, time– Better like your lawyers
Preparing
Draft
Review
File
SECComments
• Develop roadshow pitch– Looks and legs– Clear message– Practice, practice, practice
• Get in shape
Copyright © 2001, Simplex Solutions, Inc. 9
Market and Price
• Valuation and liquidity– Agree on final range
– Agree on quantity of stock
– Follow your bankers advice
• Market your stock– 2-3 weeks
– 60-70 meetings
– Tune your message
– Keep your board and executive team informed
• Price– Understand order level and after market demand
– Don’t get greedy
Copyright © 2001, Simplex Solutions, Inc. 10
Follow up
• Volatility– Prepare your employees
• Support
• Regulation FD
• Focus on the long term– Execute– Keep the long term in front of your people
Copyright © 2001, Simplex Solutions, Inc. 11
• Be clear on the End in Mind for your company
• IPO is not the End in Mind• Listen to your bankers• Don’t get greedy
