NetSuite Announces IPO Filing with the SEC

Finally, after months of speculation and rumors, NetSuite is gearing up for the public market.

Finally, after months of speculation and rumors, NetSuite Inc. announced July 2 that it has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission relating to the proposed initial public offering of its common stock.

NetSuite, based in San Mateo, Calif., develops on-demand ERP [Enterprise Resource Planning] and CRM [Customer Relationship Management] software for the small and midsize business market.

The company has an interesting history in that it began as the small business arm of Oracle Corp., the worlds second largest business applications developer behind SAP AG. Around 2000, NetSuite licensed the Oracle brand and introduced its Oracle Small Business Suite. The affiliation with Oracle was a no-brainer from an executive standpoint: Oracles CEO, Larry Ellison, owns 41 percent of NetSuite.

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In 2004, Oracle and NetSuite began to distance themselves from one another. NetSuite stopped developing and marketing the Oracle Small Business Suite and changed its name from NetLedger to NetSuite.

"Oracle Small Business and NetSuite are literally the same product but with different things turned off and on," said Zach Nelson, NetSuites CEO, during a June 2004 interview with eWEEK. "So it didnt make sense for us to have this Oracle brand hanging off to the side, particularly when its only 5 percent of our business."

In the ensuing three years since it drop-kicked Oracle (or the other way around), NetSuite has seen the SaaS competitive landscape morph drastically., itself a public company, has since taken center stage as the standard bearer for the on-demand software market. And Oracle acquired Siebel Systems, one of NetSuites main competitors in the on-demand CRM market. Now Oracle, which once buffeted NetSuite, is in direct competition with its Siebel On Demand offerings. And others are encroaching. SAP will introduce an on-demand ERP suite geared for the mid-market later this year. Microsoft, long a mid-market ERP provider, is also releasing Titan, its on-demand CRM suite, and is rumored to be in development with – or at least considering development – of an on-demand ERP suite.

NetSuites entrance into the public market has long been in the making. As early as September 2006, eWEEK began receiving "tips" from purported NetSuite employees that the company was planning an IPO.

Credit Suisse Securities LLC will act as the sole manager for NetSuites offering. WR Hambrect + Co will act as co-manager on the offering. The number of shares to be offered and the price range for the offering has not yet been determined, according to the company.