Eloqua Debuts IPO, Ups Financial, Biz Viability
Eloqua, a marketing automation platform that helps companies determine where marketing money gets spent and whether it pays off, began trading stock under the symbol ELOQ on Thursday with 8 million common shares priced at $11.50 per share.
During the first day of trading, Eloqua's stock opened around $12 per share, jumping to $13.93, and closed around $12.89. The proceeds from the IPO should strengthen the company's balance sheet, according to Joe Payne, Eloqua CEO, who cites Adobe Systems, American Express, VMWare, Hewlett-Packard and Dell as clients.
Stephane Dehoche, president and CEO, Neolane, believes companies should direct these types of investments toward advancing technology that improves cross-channel marketing by influencing sales through the funnel, generating higher-quality leads.
Brands are spending more on marketing tools. In an email, Neolane points to Gartner's estimates that companies spent up to $25 billion worldwide on marketing software in 2011, up from about $20 billion in the previous year.
The online advertising and marketing industry continues to see a high volume of recent IPOs. Aside from Facebook, Yelp, Kayak, and Eloqua, companies like ExactTarget and Bazaarvoice recently announced public offerings. Google's Wildfire acquisition follows Salesforce's purchase of Buddy Media for $689 million in cash and stock, and Oracle's acquisition of Vitrue for a reported $300 million.
Michael Mullarkey, CEO and president of Chicago-based Brickfish, said Eloqua likely went public to gain liquidity for venture capitalists.
"The undertone is consolidation," Mullarkey said. "Social media is growing so quickly that sometimes you wake up and realize you don't have time to build the technology, so you buy it."
Look at the amount of money that went into taking Groupon, Zanga and Facebook public. Comparing initial investments with the price of stock today, Mullarkey estimates a loss of about $50 billion in capital, though the loss only happens when the stock gets sold.
Wildfire made the correct decision to be acquired by Google, he said. It remains the only social media company to receive an investment from Facebook, estimating about $400,000 in the initial seed round.