AppNexus Said To File Confidentially For Its IPO

AppNexus has filed confidentially for its IPO, according to a report by The Wall Street Journal. AdExchanger reported in June that its IPO filing was imminent.

The company is seeking a valuation in the $1.5 billion to $2 billion range, according to the Journal, which would put it in line with its 2015 round of funding. AppNexus has raised more than $300 million, including a $62 million Series F round in 2015 and $31 million this past September from News Corp.

Since 2015, AppNexus has been putting the pieces in place to file an IPO.

Last month, AppNexus laid off 13% of its workforce, which strengthened its balance sheet in the IPO filing.

In 2015, the company also addressed a huge fraud problem that reduced volume by 90%. Although other exchanges had similar problems, they cleaned up while AppNexus held off, alienating partners who found themselves purchasing nonhuman traffic from the exchange.

But the company held off on filing because the public markets were hostile to ad tech, with public companies such as Rocket Fuel, Rubicon Project, YuMe and TubeMogul trading at or below their IPO value.

AppNexus’ decision to IPO signals a changing climate for ad tech in the public markets. The Trade Desk went public at the end of September, and it’s now trading at $26, a hefty premium over its IPO share price of $18.

“It’s fair to guess that they must be very happy that competitor The Trade Desk is trading nicely above their IPO price,” said Tolman Geffs, co-president of investment bank JEGI.

And while companies like Rubicon Project and Rocket Fuel have struggled, Adobe just bought TubeMogul for double its public market value.

If AppNexus indeed filed confidentially for its IPO, it wouldn’t have to make its S-1 public until 21 days before its roadshow. That also means it will only have to show two years, not three, of financial statements.

Only companies with revenue of less than $1 billion can file confidentially. Snapchat took advantage of the same provision two weeks ago, seeking a valuation of $25 billion.