"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation."
Honestly, for me as an occasional stock investor that sounds like a serious warning signal. Why should I invest in a company that does IPO only for some people to do exits? (which was exactly the reason FB did IPO) Stock investors are looking for growth potential. It's just a conflict of interest.
For example: "I've got 100% of my wealth locked into one investment, my SurveyMonkey equity, and I'd like to have a more balanced portfolio, so I'll sell half, no matter how much I believe in this company." Seems pretty rational to me.
At the time, FB was also hitting the 500 shareholders which meant they had to start reporting everything to the SEC, same as if they were a public company. So why not just go public? (I guess they learned why...) That number may have been bumped up since then.
Not the person you asked, but I am always consistently surprised at the success of survey monkey. I was a paying customer for two years though, mostly for reasons of replicibility. Many, many, social scientists use it, even though it doesn't really support useful things like randomisation to entirely different surveys.
The interface is nice, and they appear to have sewn up the marketing world, so well done to them. I still want to build a much better version, but I'm not sure if there's a market for it.
I know this might seem kind of silly but isn't the success of survey monkey a sign that there is a market for what they offer?
Unless there is something I'm missing, kind of like there are markets for medicine and the system could use improvement but there are major roadblocks to overcome (in this case I don't know what it is which is why I ask).
From what I see, they somehow managed to get some top notch clients using their product. I guess it's the level of professionalism their product projects for itself.
Honestly, for me as an occasional stock investor that sounds like a serious warning signal. Why should I invest in a company that does IPO only for some people to do exits? (which was exactly the reason FB did IPO) Stock investors are looking for growth potential. It's just a conflict of interest.