Bill.com had a successful debut in the public markets on Thursday as investors warmed to the B2B payments company despite recent setbacks for other tech startup IPOs.
The stock closed at $35.50, up more than 61% on the IPO price of $22 — which, in an earlier indication of investor interest, was above an already-raised range of $19 to $21. Bill.com raised $215.6 million through the initial public offering, with a valuation of roughly $1.6 billion.
As Business Insider reports, Bill.com’s listing “comes at the end of a rocky year for unprofitable startups looking to go public.” The casualties have included growth-focused companies such as WeWork, which scrapped its proposed offering, and Uber, whose stock price has cratered since its May listing.
Bill.com has not yet turned a profit but it has reported growing revenues and modest losses as a percentage of revenue. In its most recent quarter, it reported $35.2 million in revenue (up from $22 million year-over-year) and $5.7 million in losses (up from $905,000 year over year).
The company’s “solid growth and moderate losses, it seems, were more than enough to secure a strong welcome to the public markets,” TechCrunch said, adding that “not only can companies still losing money and burning cash go public, they may even get a strong reception.”
Bill.com, which was founded in 2006, provides bill-payment software to businesses. CFO John Rettig attributed the successful IPO to “the huge market opportunity we’re going after.”
“We have 81,000 customers today out of the six million small businesses in the U.S., the vast majority of which are still operating with legacy paper-based processes,” he told Business Insider. Bill.com has a unique combination of subscription revenue and transaction-related fees, positioning it for growth and eventually profit, he said.
Bill.com raised more than $300 million in the private markets from investors such as Temasek, Scale Venture Partners, JPMorgan, and Emergence Capital. “We did have confidence throughout the year that [the IPO] was going to be a worthwhile effort,” CEO Rene Lacerte said.