Corio manages, implements and remotely hosts business applications for customers in the so-called application service provider market. ASPs target their services at businesses looking to outsource software upgrades and other internal computer systems maintenance.
The San Carlos, Calif.-based company said in its SEC filing, released on Friday, that its offering will be managed by Goldman Sachs and co-managed by underwriters Merrill Lynch and Robertson Stephens.
Corio was one of the first companies to enter the application hosting market, alongside USinternetworking and Interpath. The market has recently garnered attention from a wide range of technology providers, including giants AT&T, Oracle, SAP, Gateway and Dell. Several companies are making an effort to grab a piece of the lucrative application hosting pie, a market analysts say could be worth $23 billion by 2003.
Under the ASP model, customers pay a monthly fee to have their software hosted and maintained by a service provider. Typically, the company pays for the software license up front and forms a three-year maintenance agreement with the ASP, which promises to get the software up and running in about six to eight weeks or less.
To date, Corio rents business applications from software makers such as PeopleSoft, SAP, Siebel Systems, Broadvision and Commerce One. Revenues for Corio's fiscal period of 1999 totaled $5.8 million, up from $1.3 million in its year-ago period.
Corio, which is led by former Oracle executive George Kadifa, said in the filing that it has incurred "significant" operating losses and has yet to turn a profit. As of Dec. 31, 1999, the company, which currently employs about 456 workers, had an accumulated deficit of $48.2 million.
The company said it expects to use part of the proceeds from the IPO to repay outstanding debt of approximately $10 million under a loan agreement to computer services firm Comdisco. The company said additional net proceeds from the offering will be used for working capital and general corporate purposes such as marketing and sales efforts, research and development, expansion, and possibly acquisition of or investment in other complementary businesses, product lines or technologies.
Founded in early 1998 by current chief strategy officer Jonathan Lee, Corio said its client roster includes Internet giant Lycos and online grocer Homegrocer.com.
Earlier this year, Corio won a $10 million investment from computing giant Microsoft for joint application hosting marketing and sales efforts. To date, companies that have already taken an equity stake in Corio include PeopleSoft, Siebel, Concentric Networks and Sun Microsystems.
The company said it plans to trade on the Nasdaq under the ticker symbol "CRIO."