Banking, finance, and taxes

BlackLine Announces Potential Pricing for IPO

Chris Lange

Published: October 18, 2016 12:45 pm

Last Updated: January 13, 2020 2:14 am

BlackLine has registered an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) for its initial public offering (IPO). The company expects to price its 8.6 million shares in the range of $13 to $15 per share, with an overallotment option for an additional 1.29 million shares. At the maximum price the entire offering is valued up to $148.35 million. The company intends to list its shares on the Nasdaq under the symbol BL.

The underwriters for the offering are Goldman Sachs, JPMorgan, Pacific Crest Securities, Raymond James, William Blair and Baird.

This company has created a comprehensive cloud-based software platform designed to transform and modernize accounting and finance operations for organizations of all types and sizes. Its secure, scalable platform supports critical accounting processes such as the financial close, account reconciliation, intercompany accounting and controls assurance. By introducing software to automate these processes and to enable them to function continuously, BlackLine is enhancing real-time visibility into their operations.

Critical accounting and finance processes underlie the integrity of an organization’s financial reports. The lack of effective accounting and finance tools can result in inefficient and cumbersome processes and, in some cases, accounting errors, restatements and write-offs, as well as material weaknesses and significant deficiencies. Traditional enterprise resource planning (ERP) systems do not generally provide effective solutions for processes handled outside of an organization’s general ledger, such as balance sheet account reconciliation, intercompany transaction accounting and the broader financial close process.

Many organizations also use multiple ERPs and other financial systems without a platform to efficiently integrate them. As a result, to manage these tasks organizations rely on spreadsheets and other labor-intensive processes that are unsuited for the increasing regulatory complexity and transaction volumes encountered by many modern businesses.

The company detailed its finances as follows:

We have experienced significant revenue growth and adoption of our platform in recent periods. For the years ended December 31, 2014 and 2015, we had revenues of $51.7 million and $83.6 million, respectively, and we incurred net losses of $16.8 million and $24.7 million, respectively. For the six months ended June 30, 2015 and 2016, we had revenues of $37.5 million and $55.6 million, respectively, and we incurred net losses of $10.8 million and $16.9 million, respectively.

BlackLine intends to use the net proceeds from this offering to repay the entire outstanding balance under its credit facility and for general corporate purposes, including working capital, research and development activities, sales and marketing activities, general and administrative matters and capital expenditures and to fund our growth plans.