On Monday, the cloud software company Qualtrics filed its paperwork with the U.S. Securities and Exchange Commission to carry on as an independent company. The initial pricing range of $20 and $24 a share would value the company at $12 billion to $14.4 billion. As a reminder, two years ago SAP bought the company for $8 billion.
Interestingly, the cloud software company will trade on the Nasdaq under the ticker “XM”.
The company sells software that helps businesses gauge how customers use their products so they can improve their offerings. As a reminder, Ryan Smith founded the company in 2002 along with his brother and father, giving the family a 40% stake at the time of acquisition. Interestingly, Ryan Smith will remain chairman of the company.
Cloud software company and plans for the future
Interestingly, Qualtrics is aiming to take advantage of surging demand for high-growth cloud software companies. The market was growing even before the pandemic but the pandemic made the market even more lucrative. For example, at least 10 subscription software companies have more than doubled in value this year.
It is worth noting that, SAP former CEO Bill McDermott orchestrated the Qualtrics deal before leaving the company in 2019 to take the top job at ServiceNow. However, under the leadership of new CEO Christian Klein, the German software giant is changing course and going in the opposite direction of Salesforce. As a reminder, Salesforce agreed to buy Slack for $27.7 billion in December.
People should take into account that, the cloud software company continued to grow in its brief tenure under the SAP umbrella.
Last summer, SAP announced its plans to spin out Qualtrics while keeping most of its ownership. Importantly, after the IPO, which is expected as early as January, SAP will own 80% of the outstanding shares.