Tech Transformers

A software firm backed by Salesforce and Mark Zuckerberg’s investment adviser heads for an IPO

Apttus, a U.S. software firm backed by Salesforce's venture arm and some of Silicon Valley's biggest entrepreneurs, is planning to go public this year, the company's chief executive told CNBC.

The Silicon Valley start-up sells so-called "quote-to-cash" software which provides salespeople with the ability to create an offer, develop a quote and contract, then collect the cash from customers.

Apttus raised $88 million in September from investors including Gulf Islamic Investments, K1, KIA, and Iconiq Capital, a highly secretive wealth management firm that manages investments for the likes of Facebook boss Mark Zuckerberg, LinkedIn founder Reid Hoffman and Twitter CEO Jack Dorsey. Salesforce Ventures is also an investor.

Now Kirk Krappe, CEO of Apttus, said the company is on track for an initial public offering (IPO) the first half of this year.

"We have done our internal assessment, we have hired an outside company, we have an exact plan of everything we need to put in place. We have probably done fifty to sixty percent of the preparation already … we need to expand the board of directors which is a common thing you need to do before you go public. We need to hire some critical senior management team like a general counsel for instance on board," Krappe told CNBC in an interview on Tuesday.

Marc Benioff, CEO of SalesForce.
Adam Jeffery | CNBC

Hiring a general counsel is part of the legal requirements before a company can IPO. Krappe said he had not chosen a book runner for the IPO which is typically an investment bank, but said this is "relatively imminent" with conversations ongoing among the major players including Goldman Sachs, Morgan Stanley and Barclays.

‘Breakeven this year’

Krappe's comments come as experts forecast that 2017 could bring a slew of technology companies onto the public markets including Snap – the owner of ephemeral messaging app Snapchat – and even music streaming service Spotify. Apttus' CEO said he isn't worried about fatigue among public investors for new technology stocks because the company has solid finances. After the company was founded in 2007, it was profitable for seven-and-a-half years, until Kirke decided it was time to take a $37 million funding round led by Salesforce Ventures and invest in growth.

The company is now looking at being breakeven again this year, while revenues grew 50 percent last year to $150 million.

"There is so much liquidity in the public markets that if they go well, I don't see how liquidity would dry up," Krappe said.

"It comes down to the performance of those companies … I don't fear that because what I do believe is in quality. Actually if you have a quality company, we have a tremendous company, if you have all of that you should weather it. If the market is bad and these companies all fail, we are going to think twice (about an IPO). But I think we have enough strong metrics."

Clarification: This story has been updated to reflect that Salesforce Ventures is an investor in the company.