Current TV, the news network owned by formor vice-president Al Gore, saw a drop in its ad revenue for the first quarter of the year.
It seems advertisers are still wary of the relatively new news network that focuses heavily on user generated content to fill its airwaves. Currently the network is carrying $41 million dollars in debt, up $5 million from the end of last year, and now the bad news of their advertising revenue makes the picture even bleaker. According to Joseph Weisenthal of PaidContent, their advertising revenue dropped from $2.64 million to $2.5 million for quarter-over-quarter, signaling the company may fall even deeper in to debt.
All of this information comes out as the company is looking into a potential IPO, so the timing couldn’t be worse for them. While the stock offering might help them out with their debt, it doesn’t seem likely people will rush to invest a company with slipping revenues.
We here at Mashable just hope the feature they did on Pete didn’t factor into this!mashable109:http://mashable.com/2008/05/20/current-tv-sees-drop-in-ad-revenue/
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Russia’s leading search engine, Yandex, is set for a massive IPO this fall according to a report from Reuters. The site claims approximately 47% of the search market in Russia (Google is second), with revenues of $167 million last year. Yakov over at Quintura notes that the company has about 2.2% of the total European search market, which beats both Yahoo and Microsoft.
The IPO would reportedly raise $2 billion for Yandex and value the company at $5 billion. That may seem aggressive, but dominant Chinese search engine Baidu trades at similarly lofty levels – 43x sales at today’s closing price of $372/share. Investors see dollar signs when a search player dominates a market in the way that Google dominates the US, and hence the interest in buying up shares of companies like Baidu and Yandex.
mashable109:http://mashable.com/2008/05/20/yandex-ipo/
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It’s been a rough few months for life-science IPOs, what with all the collapsed offerings and, often enough, miserable post-offering performance for those startups that have managed to inch their way across the finish line.
Yet the lure of the public markets remains strong, even with the Nasdaq down about 15 percent since the beginning of the year, and some startups simply will not be denied. That certainly seems to be the case with CardioNet, which just trimmed its expected IPO but expects to price it tonight, according to Renaissance Capital’s IPOhome site. Check out the company’s latest SEC filing for more.
CardioNet makes implantable wireless sensors designed to detect irregular heartbeats. Its complex IPO — which mirrors the complex structure of its last round of venture funding, itself tied rather tightly to the IPO — just got a little simpler. Where existing CardioNet shareholders had initially planned to sell 3.6 million shares alongside the three million shares the company itself was offering, the selling-shareholder portion has been scaled back to 400,000 shares.
CardioNet also dropped its expected offering price to a range of $18 to $20 per share, down from $22 to $24. That puts its maximum take from the offering, including possible overallotment sales, at $78.2 million — almost 20 percent lower than it figured just a month ago.
The reduction in shareholder sales should theoretically boost interest in the offering, since CardioNet and its shareholders won’t be competing for investors. That said, I can’t help wondering how much of a monkeywrench that tosses into the plans of CardioNet’s shareholders — many of whom, if I understand the deal correctly, invested in the company’s last round in exchange for shares to be issued the eve of the IPO.
In any event, I’m far more interested just to see how the company fares, given the generally awful climate for life-science IPOs and the fact that a similar startup — Transoma Medical — ended up withdrawing its IPO almost a month ago.
It’s been a rough few months for life-science IPOs, what with all the collapsed offerings and, often enough, miserable post-offering performance for those startups that have managed to inch their way across the finish line.
Yet the lure of the public markets remains strong, even with the Nasdaq down about 15 percent since the beginning of the year, and some startups simply will not be denied. That certainly seems to be the case with CardioNet, which just trimmed its expected IPO but expects to price it tonight, according to Renaissance Capital’s IPOhome site. Check out the company’s latest SEC filing for more.
CardioNet makes implantable wireless sensors designed to detect irregular heartbeats. Its complex IPO — which mirrors the complex structure of its last round of venture funding, itself tied rather tightly to the IPO — just got a little simpler. Where existing CardioNet shareholders had initially planned to sell 3.6 million shares alongside the three million shares the company itself was offering, the selling-shareholder portion has been scaled back to 400,000 shares.
CardioNet also dropped its expected offering price to a range of $18 to $20 per share, down from $22 to $24. That puts its maximum take from the offering, including possible overallotment sales, at $78.2 million — almost 20 percent lower than it figured just a month ago.
The reduction in shareholder sales should theoretically boost interest in the offering, since CardioNet and its shareholders won’t be competing for investors. That said, I can’t help wondering how much of a monkeywrench that tosses into the plans of CardioNet’s shareholders — many of whom, if I understand the deal correctly, invested in the company’s last round in exchange for shares to be issued the eve of the IPO.
In any event, I’m far more interested just to see how the company fares, given the generally awful climate for life-science IPOs and the fact that a similar startup — Transoma Medical — ended up withdrawing its IPO almost a month ago.
Now that the Bioheart IPO has doubly surprised everyone — first by happening at all, and second by coming out on such dreadful terms for the company — perhaps it’s time to take a closer look at exactly where the 2008 offering market for life-science companies stands. In fact, I’ll aim to make this a regular feature, because the IPO market is still a useful leading indicator for venture funding.
Data for the following analysis comes courtesy of Renaissance Capital’s site IPOHome, which is a pretty standout resource for this kind of thing. Twenty-three life-science startups are currently queued up for takeoff, although only two have even established a price range. Of the three that have made it through the IPO gate this year, only one — healthcare provider IPC — has seen its shares rise, while investors have greeted both MAKO Surgical and Bioheart with something less than enthusiasm.
Three startups have postponed their offerings indefinitely, while another five have withdrawn them outright. It’s looking pretty likely that we’ll see these numbers swell further before long.
Here are the numbers:
Pending IPOs
Priced IPOs
Postponed IPOs
Withdrawn IPOs
The embattled cell-therapy startup Bioheart finally limped across the IPO goal line yesterday, but it was a Pyhrric victory. The startup, which once sought $70 million, ended up netting as little as $1.5 million. And almost half of that amount came directly from Bioheart founder Henry Leonhardt instead of outside investors.
Bioheart, of course, has had no shortage of problems, which we’ve chronicled over at VentureBeat Life Sciences. For the latest installment, see here.
The New York Giants they ain’t, but the team at embattled cell-therapy startup Bioheart still managed to defy long odds and successfully dragged their company into the IPO endzone earlier today. No doubt football great Dan Marino — one of the Sunrise, Fla., biotech’s backers — fired everyone up with a suitable pep talk.
Bioheart’s arduous drive to the public markets, however, came at quite a cost. The startup, which last September hoped to raise $70 million in its offering, instead stands to net as little as $1.5 million once it accounts for underwriting, commissions and unspecified “offering costs” of $4.3 million. The offering values Bioheart at a bit over $75 million, which is awfully low for a public biotech, and a mere fraction of the $270 million market cap it once hoped for.
Any way you look at it, that’s simply a miserable return on the year of effort Bioheart put into this offering. Since Feb. 13 of last year, the company has slashed its expected offering price twice, fired its initial underwriters, and cut the number of shares offered by almost 75 percent. All I can say is that this is one company that was determined to go public, no matter what it took.
I’ve given the company more than its share of grief over that time. Its leading product, a cardiac cell therapy called MyoCell, has shown decidedly mixed results in clinical trials, as I detailed back in July. Add to that its shaky cash position — just over $9 million in cash and cash equivalents as of last Sept. 30 — and the fact that the company’s primary patent on MyoCell expires next year, and you still have what looks like a looming disaster. (I took a second whack at the company in October when its offering seemed to be on the brink of collapse.)
Still, I have to give the company credit for determination, if not exactly for smarts. Unfortunately, true grit only gets you so far — Bioheart’s shares traded down 25 cents today, closing at $5.
UPDATE: I should also note the interesting fact that two Bioheart officials — founder and executive chairman Henry Leonhardt and board member Peggy Farley — have apparently availed themselves of the opportunity to tout Bioheart in our comments section. (Leonhardt’s comment appears here; Farley’s is here.) I say “apparently” because I don’t have independent confirmation that these commenters are who they say they are, although these comments do strike more or less exactly the tone of boosterism, belligerence and desperation I would have expected from folks in their position. The presumed Leonhardt comment — which came in response to an item on another Florida life-science startup slashing its offering price — includes this gem (emphasis added):
Raising $63.8 million is a great accomplishment! MAKO is another South Florida Biosciences success story! Home of Cordis, World Medical, Bolton and Bioheart, Inc. other great life science companies.
Leonhardt, by the way, planned to purchase 114,286 shares in the offering, which would make his total ownership stake in Bioheart just over 32 percent following the IPO, a holding worth about $24 million at the company’s current valuation. Ms. Farley, meanwhile, exercises control over a 3.4 percent stake in the post-IPO company, now worth about $2.5 million.
Separately, I should note that while I’ve previously described MyoCell as an “adult” stem-cell therapy, there’s apparently some disagreement in the scientific community as to whether the muscle-precursor cells used in MyoCell actually qualify as “stem cells.” To avoid confusion, I’ve used the term “cell therapy” here instead.
Fresh from the Department of Whistling Past the Graveyard in today’s VentureWire:
Back in the real world, seven life-science IPOs have gone down in flames so far this year. An eighth startup, robotic-surgery maker MAKO Surgical, just slashed its offering price.
Last year was a tough one for IPOs, as Matt noted earlier, and so far this year looks even worse. Aptamer-drug maker Archemix today became the third life-science startup this month to withdraw or postpone an IPO, and the sixth so far this year. We take a closer look at the worsening IPO climate and the contrast with still-bullish venture funding in the sector, over at VentureBeat Life Sciences.
It’s sure starting to look that way. News that Archemix, a Cambridge, Mass., developer of aptamer-based drugs, yesterday withdrew its $72.5 million IPO follows closely on the heels of several other recent several other IPO collapses, including those of implantable diagnostic maker Transoma Medical and biotechs Biolex Therapeutics and BG Medicine. (Our coverage is here, here and here.) Transoma, in fact, had set its offering terms just a few weeks earlier. Most everyone, of course, is citing ubiquitious unfavorable “market conditions” as a reason for the withdrawals.
None of this exactly comes as a surprise, given that the subprime-mortgage crisis and related fallout has blown off 20 percent of the Nasdaq’s value since its recent October high. Yet hope continues to spring eternal. Last week, MAKO Surgical just filed to raise as much as $94 million for its robotic knee-implant system. The previous week, hepatitis drug-developer Phenomix filed for an $86.3 million IPO, and in early January Bayhill Therapeutics began looking for $86.3 million.
The pace of IPO withdrawals, however, seems to be accelerating. By my count, only one life-science startup — arterial-stent maker Devax — yanked its IPO in December. (Precision Therapeutics also dropped its IPO that month, but went public via a reverse merger.) In January three more — Bioheart (our coverage), Elixir Pharmaceuticals (our coverage) and BG Medicine — followed. Now, in just the first week of February, another three offerings have gone down the tubes. At this rate, it should be a rout by next week.
Completed life-science offerings have also grown far rarer, even accounting for the generally anemic biotech-IPO market over most of 2007. In the last 60 days, only MedAssets, a healthcare-IT concern, and IPC, an inpatient-care provider, have made it through the IPC gate, and both have done quite well — IPC is up 38 percent since its Jan. 24 offering, while MedAssets has risen 24 percent since Dec. 12. Prior to that, you have to look back to three companies that priced at a discount in November — EnteroMedics (Nov. 14, now up three percent), ARYx Therapeutics (Nov. 7, now down 25 percent) and BioForm Medical (also Nov. 7, now down 29 percent).
As Matt noted last month, most life-science IPOs that have made it out of the gate over the past year or so haven’t performed very well. That stands in sharp contrast to buoyant venture-capital financings in the sector, which are apparently being sustained by the belief that big pharma and medical-device makers will continue to pony up major sums for startups with promising technology. It’s too soon to say whether that trend, too, has started to level off — my suspicion is that it may well have, although the desperation of Big Pharma, in particular, remains high — but there certainly haven’t been too many big deals in recent months.