Smile wide and eyes big as he looked up at “Bandwidth blue” billboards draping Times Square skyscrapers in the heart of New York City on Friday morning, David Morken uttered a single word, “Surreal.”
Surreal to be standing alongside his Bandwidth co-founder Henry Kaestner, investors, direct reports and family members who believed in his vision for a new sort of telecommunications company over the last 18 years.
Surreal to have just “rung” the opening bell on the Nasdaq stock exchange.
Surreal because November 10 is already a special day for the U.S. Marine turned entrepreneur: the 242nd birthday of the Corps and his veteran father’s birthday.
Morken called the timing of his company’s $80 million IPO “the providence of the good Lord.”
And that wasn’t the end of his gratitude.
An all-hands meeting
Throughout a morning of celebration and anticipation at the tech company-friendly exchange, Morken pointed to the sky in thanks to God. He thanked employees in the room and back home watching a webcast in Raleigh and Denver.
And in the moments after trading of the stock called BAND began, Morken called an “all hands” meeting, leading the entire room in a prayer for his employees, customers and for “the mission ahead of us.”
The culture of the Raleigh-headquartered software company shined throughout the events. It’s what company leaders believe drew investors to its story during a two-week roadshow in September, which led to several hundred thousand shares sold at above the $20 per share listing price in the first few minutes of trading.
Nasdaq loved that Bandwidth is founder led, mostly bootstrapped and operating in a compelling and emerging space, said Eklavya Saraf, who works to convince companies to list with Nasdaq as its managing director of new listings and capital markets.
Also, “I think it’s fantastic we’re seeing a technology deal come out of Raleigh,” he said.
IPO plans took shape after Republic Wireless spinout
Plans to go public happened relatively quickly for Bandwidth, which operates its own voice over Internet network for enterprise and makes APIs for enabling calls and messages in apps.
Several months after spinning out its sister company, Republic Wireless, the team began to discuss strategies to expand sales and marketing efforts and continue innovating. With a tighter brand after the split, blue chip clients like Microsoft and Google to brag on, favorable capital markets and broader awareness among investors of the CPaaS (communications platform as a service) space, they started meeting with bankers in June.
The initial filing happened at the end of August, after which Morken and Bandwidth President John Murdock hit the road, taking hundreds of meetings with institutional and hedge funds, bankers and other potential investors in eight U.S. cities.
Morken compared the experience to the mens’ last epic nationwide journey together, the 3,000-mile Race Across America bike race. They had to be on at all times and to stay hydrated to keep their brains sharp, he said. And they certainly felt fatigue,.
But at one point in the back of a car along this journey, they remembered the intensity of the race and said to each other, “This is nothing. We got this.”
Company history: Resilience
Morken, who has a history of taking on extreme physical challenges, said “they laminate you with resilience.”
Several employees and investors used the word resilience when they reflected on the company’s history. David Neunberger, who became Bandwidth’s fifth investor in 2002, uses Bandwidth as an example during his talks at the Wharton School of Business.
“I’ve seen this company go up and down,” he told me. “If you think it’s get rich quick, it’s not.”
Murdock said “miracles happen” as he reflected on nearly a decade with the company, from outside investor to general counsel to president for the last several years. He’s proud of the company’s “retro IPO”, a 1990s-esque capital strategy to fund more growth rather than provide venture capitalists and founders a liquidity event
“You don’t see a co-founder 18 years in signing up for the next age,” said Murdock of Morken. “He’s been all in since day one—it’s his mission, calling, vocation.”
And in fact, Morken never had an outcome in mind as he launched the company from his parents duplex in Park City, Utah in 1999 and grew it past $150 million in annual revenue today.
He doesn’t view the IPO as an outcome either.
“Today is another beginning,” he said, reminding his team of the time it took to create value for Bandwidth, and the ebb and flow of the markets likely to happen in the days to come.
On Monday, he’ll be back at the helm of the company focused on the same disciplines of conserving cash, turning a profit, and treating customers and employees well. He’s used to oversight by the FCC—now he’s got the SEC to manage too.
He expects the Nasdaq relationship to be a fruitful one. Besides the televised opening bell ceremony, billboards, champagne, photo ops and other hoopla of IPO Day, Bandwidth gets access to market intelligence as well as an open invite to celebrate company milestones, analyst events and product launches at the Nasdaq offices on Times Square.
Starting today, it joins a family of Nasdaq-listed companies including Apple, Tesla, Google, Dreamworks and Amazon.
In his final words to his employees gathered Friday, Morken asked them to “Savor this.”
But also, to look ahead.
“Here’s to the future and the new beginning that this is,” Morken said. “Thanks and let’s roll.”
(Note: Bandwidth paid Baverman’s expenses for the trip to NYC. Baverman, the former editor of ExitEvent, covered the Bandwidth IPO as a contributor to WRAL TechWire.)