Rackspace IPO: $1.45 Billion
August 8, 2008 by Jayvee Fernandez
Filed under Computers
The tech IPOs are back, baby. Rackspace has a longstanding reputation as the luxury hosting company, the one you get before your business grows into needing a CDN. They were actually YouTube’s first hosting company: just two years ago, Chad and Steve had over a hundred servers there. Their IPO this morning is an overnight success ten years in the making.
The company that will trade on the NYSE under the ticker RAX is selling about 15 million shares at $12.50 each, in the process raising about $187.5 million from the market. That would give the company a valuation of around $1.45 billion. Goldman Sachs, Credit Suisse and Merrill Lynch are joint bookrunners on this deal.
The “Rackers” I’ve spoken with all strike me as very accommodating and straightforward. The hosting business is littered with fly-by-night scams and empty promises, so communication and transparency are highly-prized virtues in this space.
I still remember server farms closing shop one after another in the aftermath of the dotcom bust. A top-tier server farm now riding high on an IPO bodes well for the Internet industry as a whole.
