RightNow employees strike it rich
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RightNow Technologies, a supplier of online customer relationship management (CRM) applications, has filed for an initial public offering (IPO) of shares.
Ever since prospectors descended on the place in the 1860s, the area around Bozeman, a sleepy town surrounded by the Rocky Mountains, has been known as 'Gold Country'. Now, many of its 25,000 residents are set to join America's latest gold rush. One of the town's biggest employers, RightNow Technologies, a supplier of online customer relationship management (CRM) applications, has filed for an initial public offering (IPO) of shares. A lot of Bozeman people seem poised to make their fortunes.
Admittedly, this is not the first time that RightNow has been down this road. Like many other technology companies, it withdrew an IPO in 2000 after the market headed south. But the conditions seem more favourable this time. Nasdaq, where RightNow will be traded, enjoyed a relatively strong 2003. And the interest surrounding rival Salesforce.com's IPO should mean investors will be more sophisticated in the ways of online CRM companies. That is good news for RightNow's customers and prospects, since a cash injection of $70 million should ensure the company's longevity.
Salesforce is helping its smaller rival in another important way. As the first of the new breed of ASPs (application service providers) to go public, Salesforce has been viewed as a test case by the US stock market regulator, the Securities and Exchange Commission (SEC). Since ASPs charge monthly or annual fees for their services, rather than asking for upfront licence payments and ongoing maintenance fees as traditional software companies do, there has been concern in some quarters about their revenue recognition methods. It is thought the inquiry into Salesforce's IPO has enabled the SEC to set accounting guidelines for all ASPs.
RightNow will be keen to avoid a delay. Salesforce may specialise in sales force automation while RightNow's expertise is in customer service, but both share the same danger: the emerging threat of Siebel Systems, which has launched an ASP service of its own. The residents of Bozeman might feel they have a better chance of striking gold by cashing in their RightNow shares quickly.
