Language-learning software company Rosetta Stone (RST) went public in a rather nifty IPO on Thursday amid little fanfare. You still can't get a quote for the stock on Google Finance but I'm sure they're busy.
One of the things this market needs is some good IPOs. RST rose 40% on day one. Good, or even frothy IPOs accomplish three things. They make:
- investors both retail and institutional feel better about buying stocks
- institutional investors feel better about risky assets in general
- venture capital and private equity guys feel better about committing capital. If the IPO liquidity event is not a possibility for these private investors, money tends to flow much more slowly
I'm not sure whether RST will work from here. It might. Learning a new language is like getting in shape - it's easier to join a gym or buy some software than it is to do it.
Morgan Staney was lead underwriting and they know how to coach a company into a position to beat-and-raise for the first few quarters.