Workday Caps Off August IPO Surge With $400 Million U.S. Filing

| About: Workday (WDAY)

Workday (NYSE:WDAY), an on-demand provider of enterprise software, filed on Friday with the SEC to raise up to $400 million in an initial public offering. Workday serves over 325 customers worldwide, such as Aviva International, AIG (NYSE:AIG), Four Seasons Hotels, and Georgetown University, that utilize the software to address a broad range of business applications, including payroll and human capital management. Workday was one of 5 IPOs to file last week, capping off 17 total filings in the month of August, which was the most active month since March, 2012.

First half 2012 bookings grew 79% year-over-year to $179 million primarily due to the addition of 125 new customers. Workday booked $199 million in sales for the 12 months ended July 31, 2012, 66% of which resulted from subscription revenues. Over the last three years, Workday's revenue has grown at a CAGR of 75%. The company became cash-flow positive in the six months ended July 31, 2012, generating $8.6 million in free cash flow, compared to -$2.7 million in six months ended July 31, 2011.

Workday previously filed confidentially on June 28, representing the seventh consecutive US filing (excluding Santander Mexico's (NYSE:BSMX) dual-listing) to have used the confidential submission prior to publicly filing. Workday was on our private company backlog.

The company was founded in 2005 by David Duffield and Aneel Bhusri. The two had previously worked together at global enterprise software company PeopleSoft, which Mr. Duffield originally founded in 1987. Duffield and Bhusri hold pre-IPO stakes of 53% and 19%, respectively. Notable venture capital backers include Greylock Partners (11%) and New Enterprise Associates (10%).

The Pleasanton, CA-based company plans to list under the symbol WDAY. Morgan Stanley (NYSE:MS), Goldman Sachs (NYSE:GS), Allen & Company and J.P. Morgan (NYSE:JPM) are the joint bookrunners on the deal. No pricing terms or exchange was disclosed.