Bridgewater talks about its IPO

It has been a while since software start-ups in the telecom industry had the confidence in the market and themselves to launch an initial public offering. But as Tyler Nelson, vice president of marketing for Bridgewater, said of his 10-year-old company: We are no start-up. On Dec. 14, the company closed its IPO at $5.50 per share. The company had been hoping for more, but it’s done, it was successful and it is time to move forward. So far, they’re down a dime, but raised $20 million. Nelson spoke with Telephony’s Tim McElligott about the IPO and what comes next.

On why Bridgewater went public:Aside from a liquidity path for our investors, it provides us a clear path forward for growing our business in step with the demand we are seeing. We will now have a focus on meeting that growth opportunity in a few ways: We are extending our ability to grow globally, particularly in the Asia Pacific and European marketplaces. And with the currency we now have as a public company, we will begin carefully looking for product and business acquisition opportunities. Going public allows us to look at non-organic means to grow our business. At this stage we are not saying specifically what we want from a product perspective, but I would say, pragmatically, we will execute an M&A strategy that examines product and business strategies that are highly adjacent to our business.

On why the time was right:We have from time to time considered other listing opportunities, but the key driver was the stage of maturity of our business. We have been profitable for 14 consecutive quarters, and our top-line annual growth is in excess of 35% to 40%. In the spring, we looked at two key conditions: First, did we have the capacity for the management team to execute an IPO while maintaining the day-to-day management of a high-velocity business like the one we are in? That was a big decision to make. Also, we looked at the overall market dynamics, and when we began this process in earnest, the market was strong, and we saw strong demand for our currency.

On changing market conditions: I think they were certainly challenging, but the outcome is what we are happy with. We have successfully completed our IPO. Despite tough market conditions, we are out and can move forward with managing the business.

On how this will make Bridgewater a better competitor: We are now being seen by many of our customers as a tier-one vendor. Our solutions support mission-critical data infrastructure that, in turn, support--in some cases--billions of dollars of [average revenue per user (ARPU)]. I think being a public company signals to our customers that we are a well-run, durable and stable business. It is a strong supporting indication of the strength of our business to our customers. Being public brings a level of compliance and day-to-day management rigor that a business of our size needs. It says we are a well-managed and efficient organization. We are not a startup, and this adds another layer of oversight and compliance.

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