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2017 IPO Prospects: Apttus Claims it is Halfway Ready to List

Posted on Thursday, Jun 22nd 2017

According to Gartner, the Configure Price Quote (CPQ) application suites market was worth $570 million in 2015, out of which cloud-based CPQ accounted for $157 million. The overall CPQ market is expected to grow 20% annually through the period 2020, driven by the growth in cloud-based solutions. San Mateo-based Apttus is a leading cloud-based service provider that is rumored to be preparing to go public.

Apttus’s Financials

Apttus was founded in 2006 by Kirk Krappe, Neehar Giri, and Nathan Krishnan as a cloud-based contract lifecycle management software company. Today, Apttus’ solutions help improve revenues for organizations through its Quote-to-Cash (QTC), CPQ, Contract Management, E-Commerce, and Revenue Management software solutions. It leverages its Intelligent Cloud platform that maximizes the revenue operation by streamlining and improving business processes, aligning and driving revenue winning behaviors, and recommending relevant, intelligent actions. It integrates process-based applications with modern and innovative behavioral applications including promotions, sales compensation, and rebates to align and drive revenue winning behaviors across all sales channels.

Apttus has managed to amass a strong following in the market. It boasts of more than 600 customers and 1 million users worldwide who are supported by its 1,200 employees, 25 certified consulting partners, and 1000 professional resources.

Apttus has been privately held so far and does not disclose detailed financials. Analysts estimate that the company earned $150 million in revenues in 2016. Apttus is not expected to be profitable since it has been investing in business expansion. It is, however, hopeful of breaking even this year. Not too shabby, given the numerous money-losing Unicorns out there.

Apttus has been venture funded so far with $274 million raised from investors including Gulf Islamic Investments, Kuwait Investment Authority, Salesforce Ventures, Iconiq Capital, and K1 Capital. Its last round of funding was held in September 2016 when it raised $88 million in a round that valued it at over $1.3 billion. Valuation has climbed steadily since its 2015 valuation of $1 billion.

Apttus is expected to go public this year. It has always planned for an IPO, but last year’s deteriorating market valuations and stock market conditions had delayed its listing plans. At this point, the company would probably command a valuation of at least $1.8-$2 billion.

Apttus’s Product Expansion
While Apttus waits for the public markets to turn favorable, it has been investing in product development. Recently, it announced the general availability of Apttus Snap Performance, a new software and cloud platform solution that will increase the speed of Configure Price Quote operations by up to 90%. Snap Performance leverages technological innovations such as AngularJS to enable greater customer responsiveness and UI flexibility. It provides faster scrolling across enterprise-size carts, quick searching, and pricing.

To help expand market reach, Apttus has also announced the availability of Quote-to-Cash for Manufacturing at the Microsoft AppSource. The new suite of solutions will allow manufacturers to manage channel partner relationships, complex pricing requirements, and accurately relay quoting, contract, and ordering information. It will help Apttus customers eliminate errors, speed up sales cycles, and create successful outcomes across the entire revenue operation. The solution, which is focused on manufacturing organizations, will allow companies to include product configuration, quote creation, contract negotiation, deliver revenue generating digital experiences with B2B E-Commerce, and reduce compliance risks and close more deals faster with Contract Management.

Apttus believes that it will list this year. At the start of the year, it claimed to have completed nearly 50%-60% of IPO-related preparedness and was looking to expand leadership before it went public. It may want to test the public markets, but I won’t be surprised if companies like Microsoft are looking to buy it out to build their cloud arsenal.

This segment is a part in the series : 2017 IPO Prospects

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