Intrusion-detection and prevention software developer Sourcefire Inc is set to launch its initial public offering in a rare excursion on to the public markets for an open source-based technology vendor.
The Columbia, Maryland-based company is set to raise $75m by offering 5.8 million shares on Nasdaq at between $12 and $14 a share, having filed its initial papers with the SEC in October 2006.
The company offers intrusion detection and prevention technologies based on the open source Snort rules-based detection engine created by CTO and founder Martin Roesch in 1998.
The company has raised over $53m in four rounds of venture funding from the likes of New Enterprise Associates, Sierra Ventures, Core Capital, Inflection Point, Sequoia Capital, and reported a full year 2005 net loss of $5.5m on revenue up 97% to $32.0m.
Sourcefire’s IPO will see it join an exclusive club of just six open source-based companies to have taken the plunge. Of the six open source IPOs, four came from the Linux distributors that made up the first generation of open source vendors, and many more would have occurred had the bottom not dropped out of the market.
Linux distributor Red Hat Inc lead the first wave in August 1999, raising $84m, while VA Linux (now VA Software) and Caldera (now SCO Group) followed in December 1999 and March 2000, raising $132m and $70m respectively.
They were the only Linux vendors to make it public before the market went belly up, however, as the likes of LynuxWorks, Linuxcare and Turbolinux were forced to cancel their IPOs. Turbolinux eventually made it to the Japanese Osaka Securities Exchange in September 2005 after a series of acquisitions.
Another, often forgotten, open source IPO involved French Linux distributor Mandriva, which made its debut on the Euronext Marche Libre in July 2001 as Mandrakesoft, raising $5.7m before recently acquiring Conectiva and changing its name.
Another near miss involved desktop Linux specialist Linspire, which cancelled its IPO in August 2004 as the $20m it accepted from Microsoft to change its name from Lindows made the offering unnecessary.
More recently embedded Linux and development tools vendor Trolltech announced its initial listing on the Oslo Bors in July, raising $19.2m.
While Sourcefire joins a small list of open source vendors going public, it may not be the only one to do so this year. Open source database vendor MySQL AB’s CEO, Marten Mickos, told Computer Business Review in January that the company is considering going public this year.
We are talking to bankers now but we may take our time, he said. It’s more of a timing issue, but we are making sure we can do it this year if we want to.