Gallery: IPO Lottery 2013: 10 Companies to Watch
Image by Helene McLaughlin © Rassilon Photography01airbnb
The Chinese calendar might have it pegged as the year of the black snake, but investors are already calling 2013 the year of the enterprise IPO. Not nearly as catchy as something reptilian, but hopefully a lot more profitable than the newly public consumer companies, Facebook chief among them, that took a beating in the public markets in 2012. Consistent with the enterprise theme, we already know that data-center networking company Gigamon and solid-state storage business Violin Memory have filed their S-1 forms. Other enterprise plays will follow. And just because the smart money is betting on companies that get paid selling to other companies, doesn’t mean some well-known consumer outfits, including Twitter, Square, and Evernote couldn’t try their luck with an IPO in 2013. We picked nine private companies with public market potential to watch in 2013. For each we weigh the odds of whether, market conditions permitting, of course, they have a shot or not. __Above:__ Airbnb ------ Odds of an IPO: Looking good, but only if it can close its next round This startup is the darling of the collaborative consumption movement, allowing anyone to put up their house or apartment for travelers to rent. While it’s been close to 18 months since its taken venture capital, Airbnb is already up to $230 million. Rumor has it that the company is vying for a $100 million third round of funding at a $2 billion valuation, and has plans to go public once it closes a new round. *Above: Airbnb co-founder Nate Blecharczyk. Photo: [JD Lasica](”http://www.flickr.com/photos/jdlasica/7979034891/”)/Flickr*
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Box --- Odds of an IPO: 50/50 For most of 2012, Box CEO Aaron Levie talked about plans to take his business-minded storage company public. Box is in a very good position to do so: As of October 2012, it has 140,000 active businesses, including more than 90 percent of Fortune 500 companies, signed up. Levie has said that his company has 14 million customers, though it's unclear how many are paying for Box’s storage and document collaboration [services](https://www.box.com/pricing/). (Up to 5GB of storage is free.) Box is flush, with $284 million in the bank, not including an undisclosed amount of cash that Intel gave the company in October 2012. Box’s enterprise focus will certainly make it appealing to investors in 2013, but unless it gets some public market chops in its finance department it might not be quite ready to pull the trigger. Unless it makes a few more big, public company hires, it will wait until 2014. *Above: Aaron Levie. Photo: Ariel Zambelich/Wired*
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Dropbox ------- Odds of an IPO: Good Box’s consumer-focused peer grew to 100 million users in 2012, and that’s just the beginning according to CEO Drew Houston. However, that number doesn’t tell us how many people are paying at least $10 per month for Dropbox’s premium offerings, though the company says it is bringing in significant revenue. In 2012 the company recruited Google Python developer Guido van Rossum, and several sales executives from Apple and Salesforce, which could signal the company is gearing up for a public debut. Dropbox has raised $257 million in total funding. Given its high-profile hires and two acquisitions in 2012, as well as a massive valuation, it’s likely that Dropbox is heading down the IPO path in 2013. *Photo: [ilamont.com](http://www.flickr.com/photos/ilamont/7463062672/)/Flickr*
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Evernote -------- Odds of an IPO: Very small CEO Phil Libin has repeatedly [said](http://online.wsj.com/article/SB10001424052970204755404578101270204307986.html) that he’s not itching to take his company public, even though 2012 was a banner year for the note-saving service. Evernote grew to 41 million users last year, including 1.5 million people who pay $5 per month for more storage. In May, it expanded into [China](http://venturebeat.com/2012/05/10/evernote-launches-chinese-service-yinxiang-biji-aims-for-more-paying-customers/) with a new data center and a completely Chinese version of its notetaking desktop and web app. In August, the company added a [business suite](http://stag-komodo.wired.com/business/2012/08/evernote-for-business/) to woo entire companies into signing up. Evernote attracted $155 million last year, bringing its total VC cash to $251 million. Despite explosive growth for the company, it’s speculated that its revenue and margins are low — not an attractive deal for investors. Unless Libin is is trying to throw everyone off his trail, odds are low Evernote will go public before [2015](http://www.businessweek.com/news/2012-08-24/evernote-to-hold-off-on-ipo-until-2015-at-the-earliest). *Above: Evernote CEO Phil Libin. Photo: [LeWEB12](http://www.flickr.com/photos/leweb3/6477374325/)/Flickr*
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Gilt ---- Odds of an IPO: High The designer-focused flash-sales site is definitely ready for a public offering, president Andy Page has said. In September 2012, he told [Reuters](http://www.reuters.com/article/2012/09/20/us-gilt-ipo-idUSBRE88J1HL20120920) that his company will be profitable by the fourth quarter. Gilt Groupe also began shutting down several of its spin-off sites, like Park & Bond, hoping to trim the fat and give the entire company a better chance of turning a profit going forward. With $221 million in venture capital, the company is said to be valued north of $1 billion. There seems to be a real commitment by Page and his investors to get this deal done. *Above: Gilt Groupe chairwoman and former CEO Susan Lyne. Photo: [Fortune Live Media](http://www.flickr.com/photos/fortunelivemedia/7587048568/)/Flickr*
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Kabam ----- Odds of an IPO: High After Zynga’s dismal performance in the stock market, it might be foolish to think another gaming company could go public. Gaming company Kabam is hoping that its focus on mobile will save it from a fate similar to Zynga's. One of its iOS games, called *Kingdoms of Camelot*, has already earned the company more than $100 million in revenue. CEO Kevin Chou says the company’s revenue has grown 50 percent in 2012, and projected to close the year at $150 million. (The company has not revealed final numbers for 2012.). When the company raised $85 million in 2011, sources valued Kabam at $500 million. Considering that Chou is [already talking](http://www.bloomberg.com/news/2012-09-18/kabam-weighs-ipo-as-game-maker-expands-beyond-facebook.html) about a 2013 IPO, it looks like this is the gaming company’s year. *Above: A shot of Kabam’s game Kingdom of Camelot. Image: Kabam*
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LivingSocial ------------ Odds: Don’t count on it at all After Groupon’s miserable IPO in 2011, there’s very little reason to believe that LivingSocial could go public anytime soon. For investors and consumers, the novelty of daily deals has worn off, leaving next to no hope for LivingSocial unless it can find a business model that beats Groupon’s. Amazon, one of the company’s biggest investors, has already lost $169 million on its investment and the site has been hemorrhaging employees. *Photo:[Danny\_Eugene](http://www.flickr.com/photos/delee928/6848788574/)/Flickr*
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Pinterest --------- Odds of an IPO: Not a snowball’s chance in hell Pinterest going public in 2013 is a pipe dream. Sure, it holds the title for fastest-growing site in history, and has 25.3 million monthly unique visitors, but for investors, that’s completely meaningless without revenue. Pinterest famously has kept its lips sealed about its revenue model, leaving most to believe it doesn’t have one. Until it demonstrates one, it won’t be a company any public market investor is going to take a chance on. But once it does, and if it doesn’t get acquired first (a more likely scenario), watch the investing hordes descend. *Above: Pinterest CEO Ben Silbermann. Photo: [Anya\_](http://www.flickr.com/photos/pantavila/6840504184/)/Flickr*
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Square ------ Odds of an IPO: Very good Twitter might not have a shot at an IPO in 2013, but it’s the opposite for Jack Dorsey’s other company, Square. In September 2012, the company raised $200 million from Starbucks and signed a deal with the coffee retailer to make paying for a Frappuccino as easy as whipping out your smartphone. In June, Square brought on Sarah Friar, an ex Salesforce VP, as CFO, a move that tends to hint at an public offering. If Square continues to uproot the traditional point-of-sale industry (rumors suggest it might be working on new products), it will be well positioned for an IPO either later this year or in early 2014. CB Insights co-founder Anand Sanwal believes that Square will go public before Twitter, but points out that there’s less chatter about the company among investors. *Photo: Square*
