PagerDuty pops nearly 60% in debut as tech IPO market heats up

https://www.cnbc.com/2019/04/11/pagerduty-pops-more-than-50percent-in-debut-as-tech-ipo-market-heats-up.html

by romanhn • 7 years ago

120 54 7 years ago

raiyu• 7 years ago

Looks like investors were very hungry for this one and the high jump on the first date indicates that they are viewing Pagerduty in the same market segment as MongoDB and Twilio. Same set of customers, expanding market as each of those customers increase their server foot print.

Also with the 50% pop looks like investors were ready to give them future growth so the company definitely left money on the table with their IPO pricing.

But none the less amazing IPO. Hopefully stock stays in the range on Friday.

shhehebehdh• 7 years ago

I don’t really get what makes this an amazing IPO. Afaict they left 33% of the money on the table. How is that a good thing for the company or the shareholders?

sb82442• 7 years ago

It would be good for people who bought in (higher margin), good for people selling in 6 months (employees), and bad for the company (money on the table).

dalbasal2• 7 years ago

One way or another, that shouldn't be that big a deal.

The company doesn't necessarily raise that much on IPO day. The importance of raising that sum at a 20% higher/lower valuation probably isn't the biggest thing at stake.

The IPO isn't primarily fund raising, especially for this current crop of more mature unicorns. It's primarily liquidity generating.

deathhand• 7 years ago

I think its most likely due to high usage of the service & income of those who use the service. Devops can make bank, and devops need this SAAS.

romanhn3• 7 years ago

Fun fact - this is the second YC IPO, after Dropbox.

testfoobar• 7 years ago

I'm looking at the S-1 for Pagerduty. It doesn't mention Y Combinator. Who/what entity represents Y Combinator in the shareholdings? Can we guesstimate their return?

https://www.sec.gov/Archives/edgar/data/1568100/000162828019...

jedberg• 7 years ago

You won't see them in there because their percentage is too small to be listed (under 5%).

vichu• 7 years ago

S-1s only list >5% stockholders - you'll note that the co-founders have been diluted down to 7.1%. Y Combinator has definitely been diluted below that amount, that being said random back of the napkin (aka pulled from my ass) numbers for their share count is probably 700,000ish so their return is pretty damn good.

alphagrep12345• 7 years ago

Just second?

maxxxxx• 7 years ago

Just looked up Dropbox stock price. Not exactly pretty. This is not the 90s when the retail investor could make money from tech stocks. SNAP is bad, Dropbox doesn't look good. Neither does Lyft.

defen3• 7 years ago

SQ up 5.8x since Nov 2015

TEAM up 4.1x since Dec 2015

TWLO up 4.7x since Jun 2016

SHOP up 7.4x since May 2015

OKTA up 4x since Apr 2017

ZS up 2x since Mar 2018

Retail investors can definitely still make money.

ChuckMcM2• 7 years ago

On Dropbox, for context when a tech company IPOs there are typically "ratchets" in place that prevent all shareholders from selling stock right away, so initial investors, founders, and employees often each have their own 'hold off' time that can be anywhere from 3 months to a year.

Because of this dynamic, the stock price of the company a year after they IPO is a really interesting indicator of the 'retained' value of the company. Which is to say after anyone who has a big chunk of the company could sell (and that drives down the price) versus how many people are selling. This is where the float is maximized so the stock price is more closely tied to the market value rather than a scarcity value.

Dropbox's performance has been pretty solid in this regard, especially compared to things like GroupOn or Zynga (notable problem children) or SNAP (current poster child).

I don't own any DBX that I'm aware of (I may through an aggregated ETF so for the pedantic folks I leave that disclaimer in) but it wouldn't seem to be a "bad" investment for holding.

icedchai• 7 years ago

There are plenty of gains to be had. I'm up 400% on FB, I'm up 200%+ on TWLO, HUBS, MU. I'm over 100% on PYPL, AMD.

I am down 5% on DBX.

Jach• 7 years ago

My VGT holdings have been doing well. https://investor.vanguard.com/etf/profile/VGT

cobookman• 7 years ago

SNAP is up 105% YTD.

I wouldn't discount that company yet. Their market cap is actually fairly well priced right now, and I'd wager they are under-valued (assuming they execute well over next 6 months).

YeahSureWhyNot• 7 years ago

and for a whole year of being public, dropbox kept dropping and now is 30% less than its IPO price.

rrdharan• 7 years ago

Dropbox's "IPO price" was technically $21. It opened at $29, though so perhaps that's what you mean?

julianlam• 7 years ago

Very interested in seeing the opening days of both Pagerduty and Zoom (next week). So far PD has exceeded my expectations.

Their product ain't half bad either

losvedir• 7 years ago

Good for them. IIRC, don't they use a lot of elixir? Is this the first public company to have a big elixir tech stack?

zinclozenge3• 7 years ago

The extent of their usage of Elixir is highly questionable. One of their employees was at elixirforum.com for recruiting but could not, or would not answer how much they use it for. There's also some partially substantiated rumors that the Elixir was a single employee's experiment, and those services were either in the process, or had already been re-written in Scala.

anthonybullard• 7 years ago

I don't think this is correct, from [1]:

Today, we have a good mix of teams that are fully on Elixir, teams that are ramping up, and teams who are still waiting for the first project that will allow them to say, “We’ll do this one in Elixir.”

[1] https://www.pagerduty.com/blog/elixir-at-pagerduty/

romanhn3• 7 years ago

I left PD about 5 months ago, so my information might be slightly outdated, but I can confirm that Elixir is used quite a bit internally, including for highly available critical services that all event data passes through. While there might be some truth to Elixir starting out as an experiment, its adoption has not only spread to multiple teams, but it is also the language most new services are to be written in, going forward. The unique thing about Elixir is how it appealed to both Ruby and Scala folks internally.

braythwayt• 7 years ago

I cannot comment in any way on financial matters, but like Cees, I am a principal engineer at PagerDuty, and I can tell you that in terms of total LOC, our Elixir use may seem modest because we have a lot of code that was written X number of years ago in Ruby or Scala.

However, if we look at new services being developed, we use a lot of Elixir, it is our default choice.

This dichotomy is very usual in our industry. What we have reflects our entire history, and the history of tools available when we wrote all that code.

But what we write today reflects our priorities today, and the tooling available today.

Now ask me about front-end development. Yes, we have some CoffeeScript/Backbone still in production, but we aren’t doing any new work in it!

dalbasal2• 7 years ago

Something scary about the current surge in IPOs.... Kinda feels like PEs are deciding the time to cash-out is now.

PagerDuty pops nearly 60% in debut as tech IPO market heats up

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