Wednesday, February 14, 2007

IPO Spotlight - Inc.

According to a recently filed S-1 with the Securities and Exchange Commission, Inc. a Waltham, Mass.-based company plans to offer 5 million shares in the price range of $8-10.00. Founded in 1999, provides on-demand compensation management products for business of all sizes.

Per company's website: "The attraction, motivation and retention of employees is a leading strategic priority for most companies. Moreover, compensation ranks as one of the largest expense categories for most employers." The company continues with a quote by the U.S. Bureau of Labor Statistics, which totaled employee compensation in the United States at $5.4 trillion for 2005.

While I will agree that attracting and securing skilled employees should rank high on a company's to-do list, I fail to see how intends to capture continued growth in this highly competitive industry. Salary's flagship product, CompAnalyst, boasts an extensive database of salary scales and third party surveys. Unfortunately, so do such popular portals as, and To grab market share and improve brand equity, would need to differentiate itself from the wildly popular and more trafficked sites like

For the year ended March 31,'s revenue totaled $15.3 million, up from $10 million the previous year. Despite the healthy increase in revenue, the company continues to burn cash and recorded a net loss of $3.1 million compared to $2.3 million during the previous year. It may just be me, but for a company with $15.3 million in revenues and $21.8 million debt it seems slightly egregious to coax $50 million out of Wall Street.

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