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Accept raises $82.5 million in IPO

The San Francisco-based company sells 7.5 million shares for $11 each, at the top of its preliminary range. raised $82.5 million today in an initial public offering.

The San Francisco-based company sold 7.5 million shares for $11 each, at the top of its preliminary range. shares will begin trading on the Nasdaq tomorrow under the ticker symbol "IPET." will see about $76 million from the sale after expenses. Merrill Lynch led the offering, in conjunction with Bear, Stearns; Thomas Weisel Partners and Warbur Dillon Read.

The pet supplies e-tailer is the second company to go public after an investment by the e-commerce giant. Online pharmacy and Amazon affiliate raised $90 million in an IPO in July and saw its shares more than double on its first day of trading.

Amazon, which previously owned 40.7 percent of, will see its stake drop to 30.4 percent after the offering. Hummer Winblad Venture Partners' stake will drop from 21.2 percent to 15.8 percent, and Bowman Capital Management's will drop from 6.3 percent to 4.7 percent. founder Greg McLemore will own 5.1 percent of the company after the stock sale, down from 6.8 percent, while company chief executive Julie Wainwright will own 3.1 percent, down from 4.2 percent. lost $42.4 million during the fourth quarter last year on $5.2 million in sales. Since the company's inception in February of last year, it has lost $61.8 million on $5.8 million in sales.

Like, which went public earlier this week, is operating on negative gross margins, meaning that the goods and services it sells cost the company more than it earns back in revenue. For the fourth quarter,'s gross margin was negative $6.4 million. Since inception, the company has lost $7.6 million on its sales alone.

Although Amazon has lost hundreds of millions of dollars, including a pro forma net loss of $185 million in the fourth quarter alone, even it operates on positive gross margins. During the fourth quarter, Amazon's gross margins were 13 percent, down from 19.8 percent during the third quarter. Meanwhile, eBay, which posted a $4.9 million profit for the fourth quarter, had gross margins of 71 percent during the quarter.

However,'s negative margins didn't seem to hurt the company on the public markets. After pricing above its initial range and raising $182 million in its IPO, its stock nearly doubled on its first day of trading.