Websense Inc. (Nasdaq: WBSN), which makes Internet monitoring software for corporations, made a strong market debut Tuesday as shares jumped 29 3/4 to 47 3/4, or 165 percent.
Websense priced 4 million shares at $18 apiece.
The company (profile) priced well above its raised range of $12 to $14. The range was upped from $10 to $12. Chase H&Q is the lead underwriter.
Websense's software allows corporate managers to implement Internet access policies for different user groups. Managers can rule some sites off limits, restrict access hours and produce reports tracking employee habits.
Analysts said Websense's IPO was a jump ball since the company essentially makes Big Brother software. Although Websense's products can boost productivity, they could also irk employees in a tight job market.
In an interview with ZDII this morning, Websense CEO John Carrington acknowledged those concerns. He said most companies have written Net policies and Websense's software helps automate and implement the rules.
As of Jan. 31, Websense was used by more than 7,500 organizations, including companies such as American Express, Compaq Computer (NYSE: CPQ), IBM Corp. (NYSE: IBM), J.C. Penney and Merrill Lynch & Co.
"It's up to the companies on how they use the software internally," said Carrington. "Our solution is user friendly and tries to help both sides."
Carrington said as e-commerce balloons and more companies and individuals go online, there's more potential for Net abuse in the workplace.
Carrington said Websense had a good IPO roadshow, but wouldn't detail profit or revenue projections. He did add that Websense's revenue stream, which revolves around one to three-year software subscriptions gives the company good cash flow.
As for current and potential competitors, Websense cited N2H2 (Nasdaq: NTWO), which went public last July priced at $13 and was one of last year's "broken IPOs, Secure Computing (Nasdaq: SCUR), Symantec (Nasdaq: SYMC) and WebTrends Corp. (Nasdaq: WEBT)..
For the year ended Dec. 31, Websense reported sales of $8.64 million and a loss of $9.25 million. As of Dec. 31, Websense had an accumulated deficit of $14.9 million. Twenty-one percent of sales for 1999 came from abroad.