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Open-source CRM player SugarCRM talks up IPO

Striking while the iron’s hot, SugarCRM is weighing an IPO for next year. The news comes just weeks after Workday, another enterprise software vendor, executed a hugely successful public offering. That’s an indication that the bloom is back on the IPO rose for companies offering their business software as a service. That Software-as-a-Service (SaaS) model was pioneered by Salesforce.com, (s crm) a much larger rival to SugarCRM.

SugarCRM CEO Larry Augustin said the company’s goal  is to be a public company and “there’s a chance we can get there in 2013,” according to Bloomberg.com.

Despite signs that enterprise SaaS is the place to be — Workday’ share blew past expectations on its October 12 launch — Augustin signaled the need to proceed with caution.  He’s been burnt before. 

As Bloomberg pointed out, Augustin was CEO of VA Linux, another open-source oriented company, which went public  in 1999, and quickly saw its  market cap spike at $15 billion based on sales of $12 million to $15 million, and then crater in the dot.com bust. The company unwound over the years becoming SourceForge, then GeekNet. What was left was acquired in September by Dice Holdings.

As Augustin told Bloomberg West TV: “There are lots of lessons from that. You saw that valuation come down very quickly.”

SugarCRM claims customers including Coca Cola Enterprise(s ko) and ThyssenKrupp System Engineering, the State of Oregon and Men’s Wearhouse(s mw) (which Salesforce.com also claims as a customer).

9 Responses to “Open-source CRM player SugarCRM talks up IPO”

    • I’m sure that the folks at FreeCRM are very friendly, but to claim that they are more friendly than SplendidCRM is a stretch? They don’t even list their phone number on their contact page. If you are evaluating a CRM, the best suggestion that I can give is to call or contact all three.

      Paul Rony
      President
      SplendidCRM Software, Inc.

  1. Companies go public so that owners and investors can cash-out. The bottom line is that the investors that put in $46M 5+ years ago want their money back. At SplendidCRM, we think it is a wonderful idea for SugarCRM to go public, even though we are direct competitors. The public loves to invest in companies that have friendly competitors, and none are more friendly than the folks at SplendidCRM Software.

    Paul Rony
    President
    SplendidCRM Software, Inc.

  2. Why does SugarCRM need to go public?
    They’re profitable, they have great customers, why not look after them and keep doing the good stuff?
    Going public will put extra pressure on them to make more money from existing and new customers – a very distracting exercise.

    • Yves Greenwood

      They will go public to try to push the loss and extra-high valuation on to the average stock investor.

      Dumb people will buy their stock which is the only way to return $$ VC money to early investors.

      SugarCRM will crater in price — but their weak financials mean they will never go public.