IPOs on horizon for Boulder-based tech firms

BOULDER — Colorado Technology Association chief executive Eric Mitisek sums up the state’s overall tech economy entering 2014 succinctly: Really growing.
The transaction market is heating up, and Mitisek said recently that 2014 could see several Colorado companies issue initial public stock offerings. Among those he sees as serious IPO candidates before the year is out are three in Boulder: email infrastructure provider SendGrid Inc., security intelligence platform provider LogRhythm Inc. and bandwidth infrastructure provider Zayo Group Holdings Inc..
Boulder-based Rally Software Development Corp. (NYSE: RALY) raised close to $100 million with its own IPO in April.

“When you see what happened with Rally Software, I wouldn’t be surprised to see them go down that path,” Mitisek said.

In addition to an increasing infusion of venture capital in the state, Mitisek said he sees three areas where Colorado is poised to thrive in 2014. The state, he said, should move forward in the realms of pervasive computing, private cloud computing platforms and data visualization, the science of sifting through the massive amounts of data available to companies for relevancy to make sound decisions.

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Pervasive computing refers to the overall enablement of the “Internet of things,” the devices all around us that emit data to enhance our daily experiences. Companies like Boulder-based Revolv Inc., which sells a wireless hub that allows users to sync and control all of their home’s smart features with a single smartphone app, will be major players in the industry.

Mitisek said the trend toward private cloud solutions stems from the fact that many information technology professionals have begun clawing back at cloud providers with a call for greater accountability as it relates to where their companies’ data is stored and how secure it is. Mitisek expects that companies with large amounts of consumer-related personal data will invest in cloud networks that are cloaked or secure from the internet, behind the businesses’ own firewalls for instance.

Ironically, the increasing cybersecurity risks go hand in hand with the amount of connected devices in our daily lives.

“The more data that is emitted to improve my life creates extreme value for cyber thieves, so it becomes that so much more important to protect it,” Mitisek said.

While the software industry is looking strong in 2014, the forecast seems a little more uncertain for other tech industries that have strong local presences like aerospace and clean tech.

In addition to a relaxation of certain international trade regulations relating to the aerospace industry, one thing that should help is the federal budget bill signed into law in December, said Boulder-based Ball Aerospace & Technologies Corp.’s chief executive Rob Strain. That bill eases some of the budget cuts known as sequestration. That’s good for an industry that relies heavily on government contracts. Strain said the fact that there’s a budget at least allows aerospace companies to plan for the future a bit as government agencies learn how much money they have available and where they plan to allocate it.
Strain is positive about the prospects for Ball, whose 2014 should include the launches of a Ball-made global precipitation-measuring device into space and DigitialGlobe Inc.’s WorldView 3 satellite being built at Ball. But he admits there could be some shaking out in the industry as the budget deal includes less money for the Department of Defense and intelligence.

“Some companies will do better than others,” Strain said. “I think it will be okay. It’s not going to be great by any stretch for the industry, but it’s not catastrophic.”

In clean tech, meanwhile, Navigant Research’s senior research analyst Sam Jaffe said he sees the industry declining, or “right-sizing,” a bit in 2014.

“But not as much as a lot of people think it is,” Jaffe said.

Jaffe said he sees a continued boom in the installation of solar panels in 2014 and the continued proliferation of LED light bulbs as prices come down. Boulder-based Solid Power LLC, he said, will be a company to keep an eye on in the coming year with its work on developing ultra high-energy, low-cost solid-state rechargeable batteries for a wide range of commercial applications.

“There’s a lot of people working on a lot of really interesting projects,” Jaffe said.