Brience, Wireless Internet Software Maker, Files IPO:
10/3/00 2:19:00 PM
Source: Bloomberg News
URL: cnetinvestor.com
Washington, Oct. 3 (Bloomberg) -- Brience Inc., a maker of software that customizes Internet content for wireless devices such as cellular phones, filed for an initial public offering estimated to raise as much as $100 million.
The San Francisco-based startup, founded this year by six KPMG Consulting Inc. former executives, develops software to automatically format Web pages and computer programs to fit the device being used, according to its IPO filing with the Securities and Exchange Commission. For example, when the software senses a slow connection or a device with less capability, it can send information in a simpler form.
Brience stands to benefit from demand for stocks of companies that offer ways to move the Internet from desktops to wireless phones and other mobile devices.
''The whole wireless revolution is capturing a lot of investors' imaginations,'' said Steven Tuen, co-manager of the $1 billion Kinetics Internet Fund. ''As a result, (such companies') stocks reflect it.''
Two IPOs last month demonstrated that wireless Web companies are, as Tuen described, ''one of the big trends.''
Shares of AvantGo Inc. of San Mateo, California, which makes software linking the Internet to mobile computers and phones, almost doubled in their first day of trading, Sept. 27. Its shares fell 63 cents in today's trading to 19.13, compared to their IPO price of 12.
Other IPOs
Palo Alto, California-based OmniSky Corp.'s shares rose 58 percent their first trading day, Sept. 21. Shares of the provider of Internet service for Palm Inc. organizers fell 81 cents to 17.13 in today's trading, still 43 percent above its IPO price of 12.
Other new stocks in the industry include Aether Systems Inc. of Owings Mills, Maryland, a provider of financial data over the Internet to mobile devices and a part owner of OmniSky. Aether has risen almost sixfold since going public in October 1999.
Meanwhile, Toronto-based 724 Solutions Inc., which makes software for mobile banking, most recently traded at more than two and a half times its January IPO price.
Not all have thrived, though. GoAmerica Inc., a Hackensack, New Jersey-based provider of wireless Internet access service, fell 88 cents in today's trading to 7.06, less than half its April IPO price of 16.
One challenge for Brience will be courting public investors after less than 7 months in business. The company began operations March 8, according to its IPO filing.
Even at a time when investors aren't waiting to see profits before buying many new stocks, most companies going public still need time to demonstrate they can make their business plans work, said Tuen of Kinetics Investment Fund.
''I think (Brience) would be hard-pressed to present itself as a viable investment,'' Tuen said, emphasizing he hasn't studied Brience in particular and was commenting only on its age.
Losses
Still, Brience has products to market and revenue, more than some firms seeking to go public. The company reported that from its March 8 founding through Aug. 31 -- a period of almost six months -- it lost $17.1 million, 17 cents a share, on $933,000 of revenue, according to the filing.
''We expect to continue to incur significant operating losses and have negative cash flow from operations in the future as we dedicate significant financial resources to product development and sales and marketing,'' the company said in its SEC filing, in a standard section on risks confronting investors. Similar disclaimers are common in IPO disclosures by startup companies.
Brience said in its filing that the funds raised in the IPO as well as cash on hand -- which measured $2.9 million as of Aug. 31 -- ''will be sufficient'' to fuel the business for ''at least the next 12 months'' after going public.
The exact amount to be raised in the stock sale wasn't disclosed in the filing, which left blank for now the number of common shares for sale and the price to be sought -- another common practice in IPO filings.
The offering's $100 million value was estimated only to calculate the SEC registration fee. A company spokesman declined to comment.
KPMG Connection
Brience is headed by a group of former executives from KPMG Consulting, the McLean, Virginia-based consulting unit of the KPMG LLC accounting firm. Brience Chairman and Chief Executive Roderick McGeary, 50, formerly was co-CEO at the consulting firm, the filing said.
The Brience management team includes five other KPMG Consulting veterans plus Executive Vice President of Application Services Dean Fresonke, 39, formerly the CEO of Data on Air Inc., a company acquired by Brience, according to the filing.
The company said it has licensed its Brience 2.0 software to four customers so far: BarPoint.com Inc., Hyperion Solutions Corp., Ingram Micro Inc. and Xircom Inc.
Fort Lauderdale, Florida-based BarPoint.com, provider of product information service for consumers, is using Brience as part of its strategy to let shoppers get the information where they need it most -- in the store, BarPoint.com's Chief Operating Officer Jeff Sass said.
''Brience is the not-so-glamorous part of that,'' said Chuck Davis, chief technology officer at BarPoint.com. ''They're the underpinnings.''
Selling Point
One of the selling points for Brience's software is that a company doesn't have to adjust its content based on a customer's preference for a phone, two-way pager or Palm Inc. organizer. Brience does it automatically.
Sunnyvale, California-based Hyperion, which makes business analysis software, plans to use Brience in a product still under development, aimed at supply chain management. The goal is to let customers take their analytical tools on visits to warehouses and suppliers, a Hyperion spokeswoman said.
Ingram Micro of Santa Ana, California, the world's biggest computer distributor, is still in a ''pilot stage'' for its project involving Brience, said spokeswoman Jennifer Marchetta.
Xircom, a Thousand Oaks, California-based maker of mobile networking equipment, now is using Brience to connect its Rex line of personal organizers. Xircom plans eventually to deliver all the electronic-commerce functions of its Web site on any device, an executive at the company said.
''We have one tool from behind the scenes -- being Brience -- able to manage both of those goals,'' said Xircom's Chief Technology Officer Patrick Piccininno.
Credit Suisse First Boston Corp. and FleetBoston Robertson Stephens Inc. plan to underwrite the stock sale. Brience plans to list the shares on the Nasdaq Stock Market under the symbol BRIE. |
