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Update: LogMeIn is trading at $20.13 a share in its first hour of trading. LogMeIn, a Woburn, Mass.-based company that is going public, has priced at $16 a share, according to The Wall Street Journal. LogMeIn will start trading tomorrow under the ticker “LOGM.” With 6.7 […]

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Update: LogMeIn is trading at $20.13 a share in its first hour of trading.

LogMeIn, a Woburn, Mass.-based company that is going public, has priced at $16 a share, according to The Wall Street Journal. LogMeIn will start trading tomorrow under the ticker “LOGM.” With 6.7 million shares on sale, LogMeIn raised a total of $107.2 million. It’s $16-a-share pricing was at the high end of the $14-$16 range, showing that there is a significant market interest in this company, as I pointed out in my previous post.

LogMeIn is tapping into two major trends — the rise of the distributed, mobile work force and the need for remote access — which are prompting companies to look at remote work and collaboration, especially as mobile broadband starts to become more and more pervasive. The offering is a massive windfall for its venture backers, highlighting why IPOs are the lifeblood of Silicon Valley. Here are some of them:

  • Integral Capital Partners sold $5 million worth of stock to own 5.4 percent of the company, a stake worth $18.4 million.
  • Intel Capital will own 4.2 percent of the company after the sale, worth $14.2 million.
  • Polaris Venture Partners sold $7.4 million worth of stock to hold 13.9 percent of the company worth $47.6 million.
  • Prism VentureWorks owns 18.2 percent of stock, worth $62.3 million.

The Wall Street Journal’s Scott Austin points out that these firms invested $20 million in two rounds and now their shares are worth $155 million. Sure M&A can help VCs make money, but it’s IPOs that provide the ultimate windfall.

  1. Really like what these guys do, they provide real value and are well deserving of success.

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  2. Despite this being a very crowded market, there is still plenty of room for someone to do it better. The screen sharing and remote access solutions are still very marginal, including LogMeIn.

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    1. jd, could not agree more. but as i said… this is a big enough market opportunity. I bet Logmein is going to start aggregating and sweeping up a lot of the smaller players. any thoughts on that?

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      1. I would spend more money on marketing and branding … acquire your competition 1 customer at a time. It’s worked for us so far.

        Regards,
        George

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  3. Not sure how these companies will compete with Microsoft’s free Live Mesh http://www.mesh.com

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  4. They are by far the best in the space but I agree that the space needs a lot more work to get it right. The interesting thing is that they have maintained a free model which builds loyalty but seem to have made good progress in penetrating corporate IT groups with their other revenue producing products targeted at specific IT problem areas. Hopefully they maintian that hybrid model so they stay visible.

    Om, you may be right that they now have cash to aggregate other players, the problem is that their product line is pretty broad already and if they spread to far to fast they will do a lot of damage to their business (stretching R&D capacity). If they are going to expand I could see them focusing on patch management possibly as a nice adjacent space.

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  5. I will not be an investor in this company.

    Based on their financial (http://news.cnet.com/8301-17939_109-10275931-2.html) situation it does not look like they can survive long enough as an independent public company. I think it would have been better for existing investors and employees if they got themselves sold to a larger company, instead of going IPO.

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    1. If you read that post, you would realize… the headline is sensationalist crap at best and the writer doesn’t know what he is talking about. Unfortunately, that kind of crap is misleading as your comment shows. The company is doing just fine by any metrics, now has enough cash to ride out any storm and has valuable public market equity to become a big aggregator of related technologies.

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  6. [...] paid system and even received consulting advice from the remote services technology provider, which went public last month. Moreover, Brezina said the company was unwilling to take the traditional, ad-supported route. [...]

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