Greenwave Systems Hires Goldman Sachs for Possible 2017 IPOBy
Company develops software for Internet of Things devices
CEO says Greenwave operates profitably, seeking expanded sales
Greenwave Systems Inc. has hired Goldman Sachs Group Inc. to explore a possible initial public offering as early as next year, said Martin Manniche, Greenwave’s founder and chief executive officer.
Greenwave builds software for the Internet of Things, devices such as doorbells, phones, televisions and smoke detectors that connect to the web. It is betting that its expertise in a hot technology market, along with profits, will appeal to public-market investors.
This year, Irvine, California-based Greenwave should earn $13 million before interest, taxes, depreciation and amortization, Manniche said, or $9.7 million in profit. That would make it a rare profitable company among the recent crop of tech IPOs, including Coupa Software Inc., storage service Nutanix Inc., and communications company Twilio Inc., none of which was making money when it offered shares to the public.
While the company is in the black, Greenwave may delay an IPO until it can increase sales, perhaps double current levels, Manniche said in an interview.
Eventually, “I want to take it to the multi-billion level,” said Manniche, who sold his entertainment-technology company Kiss Technology to Cisco Systems Inc. in 2005. He served as Cisco’s chief technology officer before leaving to found Greenwave in 2009.
Greenwave’s software lets people tap into data networks to control physical devices. For example, a doorbell may send a message to a viewer’s TV screen that a delivery person has arrived, allowing the viewer to click the TV remote to authorize the package to be dropped on the doorstep.
Telecommunications companies buy the bulk of Greenwave’s services, Manniche said, with Verizon Communications Corp. its top customer. The company has raised a total of about $90 million from investors including the Westly Group and Singapore’s Economic Development Board. It also has $13 million in mezzanine debt financing. The company employs 285 people, and is hiring 70 more.