* SurveyMonkey raising $800 mln in equity and debt financing
* More venture firms investing at later stages
* Private equity, SWFs and others also providing financing
* Recent botched IPOs also add to caution
By Sarah McBride
SAN FRANCISCO, Jan 17 Online company
SurveyMonkey said it aims to raise $800 million in a late-stage
venture capital financing, one of the largest such deals in the
Internet sector that underscores how many Silicon Valley firms
are no longer in a rush to go public.
A listing was once seen as the pinnacle of success for an
entrepreneur. But many firms reaching revenue and profitability
benchmarks that would make them an IPO shoo-in can now tap the
growing availability of late-stage cash and have also likely
been put off by recent botched offerings.
"We're not saying we're never going public," said
SurveyMonkey Chief Executive Dave Goldberg. "This was a better
path for us, and it would save us some of the hassles of running
a public company."
SurveyMonkey plans an equity and debt financing that will
allow it to cash out early shareholders and investors and that
will also bring in Google Inc as a new shareholder.
In contrast, many once high-flying companies that have gone
public have fallen hard and failed to stage much of a recovery.
Think daily-deals company Groupon Inc, which listed in
late 2011 at $20 and is now trading around $5, or gaming company
Zynga Inc, which listed in late 2011 at $10 and is now
trading around $2.50.
Private equity companies are also investing in companies at
earlier stages, and many venture capital firms that previously
invested only at early stages are now making "growth" or
In addition, more sovereign-wealth funds are funding
late-stage private companies, as are some big mutual funds and
wealthy individuals such as Russian billionaire Yuri Milner.
"There's so few awesome companies that can become iconic,"
said Brett Rochkind, a partner at General Atlantic, a
growth-stage investment firm. For those that might, "there's a
unlimited appetite for capital. Everyone's trying to get into
Companies that have raised outsized venture rounds in the
last year or so include coupon company WhaleShark Media, which
raised $150 million from Institutional Venture Partners and
others in late 2011, and payments service Square, which received
$200 million from Rizvi Traverse Management in September.
Document-storage company Dropbox raised $250 million from
Index Ventures and others in late 2011 and microblogging service
Twitter received $800 million from DST Global and others in late
Other companies note that they do not need an IPO to raise
"For us, an IPO is not a strategy per se," said Jonathan
Zabusky, chief executive of online food-ordering company
Seamless.com. "Given we're a profitable company and have been
for a long time, we do not need to use an IPO to raise money."
Existing profits are funding the New York-based company's
rapid growth into more cities, Zabusky said.
Timing an IPO is definitely a tricky business and sometimes
waiting may not be the answer.
Social network Facebook Inc's IPO came long after the
point when many analysts thought it should tap public markets.
The delay may have contributed to the troubled offering as many
potential investors focused on its slowing growth rates.
Facebook debuted at $38 in May, sank below $20, and is now
trading in the low $30s. Facebook's chief operating officer,
Sheryl Sandberg, is married to Goldberg.
SurveyMonkey's financing comprises a $444 million equity
component, which will be led by Tiger Global Management, whose
partner Lee Fixel will join SurveyMonkey's board of directors.
It also includes $350 million in debt financing led by JP
The funding round values SurveyMonkey at $1.35 billion.
After the recapitalization, Goldberg said that the company's
largest investors will be himself, Spectrum Equity and Tiger.
SurveyMonkey had revenue of $113 million and earnings before
interest, depreciation, taxes and amortization of $61 million in
2012, he said.
SurveyMonkey was started in 1999. Goldberg, a former
executive at the music division of Yahoo, became chief
executive 10 years later.