Company profile

Proposed ticker
MDLA
Exchange
CEO
Leslie J. Stretch
Employees
1,258
Incorporated in
Location
Fiscal year end
Former names
Medallia Inc.
SEC CIK

MDLA IPO information

19 July 2019
Expected IPO date
$16.00
$18.00
14.5M
$246.5M
$7M
2.18M
1.18M
121.6M
Use of proceeds: We estimate that the net proceeds to us from the sale of shares of our common stock in this offering, excluding the proceeds from the potential concurrent private placement, will be approximately $203.7 million, based upon the assumed initial public offering price of $17.00 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. If the underwriters’ option to purchase additional shares of our common stock from us and the selling stockholders is exercised in full, we estimate that the net proceeds to us would be approximately $228.7 million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We will not receive any of the proceeds from the sale of common stock in this offering by the selling stockholders. Each $1.00 increase or decrease in the assumed initial public offering price of $17.00 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the net proceeds that we receive from this offering by approximately $12.4 million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions payable by us. Similarly, each increase or decrease of 1.0 million shares in the number of shares of our common stock offered by us would increase or decrease, as applicable, the net proceeds that we receive from this offering by approximately $15.8 million, assuming the assumed initial public offering price remains the same and after deducting the estimated underwriting discounts and commissions payable by us. Pursuant to the allocation agreement with SCGE Fund, L.P., we have granted SCGE Fund, L.P. the right, but not the obligation, to purchase shares of our common stock from us equal to up to 4% of the number of shares being offered in this offering (excluding the shares the underwriters have an option to purchase), at the same purchase price per share as investors who participate in this offering, in a potential concurrent private placement. If we sell 580,000 shares of common stock in the potential concurrent private placement, which is the maximum number of shares that may be purchased from us in the potential concurrent private placement assuming we and the selling stockholders offer 14,500,000 shares in this offering, we estimate that the proceeds from the potential concurrent private placement will be approximately $9.9 million based on an assumed initial public offering price of $17.00 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus. A $1.00 increase in the assumed initial public offering price would increase the net proceeds to us from the potential concurrent private placement by approximately $0.6 million, and a $1.00 decrease in the assumed initial public offering price would decrease the net proceeds to us from the potential concurrent private placement by approximately $0.6 million. Each increase or decrease of 1.0 million shares in the number of shares of our common stock offered by us and/or the selling stockholders would increase or decrease, as applicable, the maximum number of shares SCGE Fund, L.P may purchase in the potential concurrent private placement by 40,000 shares, which would increase or decrease, as applicable, the maximum proceeds to us from the potential concurrent private placement by approximately $0.7 million, assuming an initial public offering price of $17.00 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus. Because we have not entered into definitive agreements with SCGE Fund, L.P. governing the purchase of shares of common stock in the potential concurrent private placement, there can be no guarantee that the potential concurrent private placement will take place or that SCGE Fund, L.P. will purchase the number of shares that they have indicated an interest in purchasing. The principal purposes of this offering are to increase our capitalization and financial flexibility, create a public market for our common stock and enable access to the public equity markets for us and our stockholders. We intend to use a portion of the net proceeds we receive from this offering and potential concurrent private placement, if any, for working capital and other general corporate purposes, as well as the acquisition of, or investment in, complementary products, technologies, solutions or businesses, although we have no present commitments or agreements to enter into any material acquisitions or investments. We also intend to use the net proceeds from this offering and potential concurrent private placement, if any, to satisfy our anticipated tax withholding and remittance obligations related to the settlement of certain of our RSUs. The RSUs that we have issued to date generally vest upon the satisfaction of both service-based and liquidity event-related performance vesting conditions. The service-based vesting period is generally between three to four years. The liquidity event-related performance vesting condition is generally satisfied on the earlier of: (i) a change in control event or (ii) the IPO Condition. We have also issued RSUs that, in addition to the satisfaction of the service-based and liquidity event-related performance vesting conditions, also require the fulfillment of a performance vesting condition which includes the achievement of certain subscription revenue growth targets. As of April 30, 2019, 8,524,211 RSUs were outstanding, including 1,091,419 RSUs for which the IPO Condition will be satisfied in connection with this offering and for which we expect the service-based vesting condition will be satisfied during the remainder of the year ending January 31, 2020. In connection with the satisfaction of the IPO Condition and the service-based vesting condition for such RSUs that will be satisfied during the remainder of the year ending January 31, 2020, we expect to withhold an aggregate of 518,792 shares of our common stock subject to such RSUs to satisfy tax withholding and remittance obligations at an assumed tax rate of 47.5%, and to pay approximately $8.8 million to the relevant tax authorities in cash to satisfy our tax withholding and remittance obligations related to the settlement of such RSUs. This amount is based upon the assumed initial public offering price of $17.00 per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, and the actual amount of this obligation could be higher or lower, depending on the market price of shares of our common stock on the date of settlement. In the event that the market price of our common stock increases, the amount of cash required to satisfy our tax withholding and remittance obligations related to the settlement of such RSUs would increase. We cannot further specify with certainty the particular uses of the net proceeds that we will receive from this offering and the potential concurrent private placement, if any. Accordingly, we will have broad discretion in using these proceeds. Pending the use of proceeds from this offering and the potential concurrent private placement, if any, as described above, we plan to invest the net proceeds that we receive in this offering and the potential concurrent private placement, if any, in short-term, investment grade, interest-bearing instruments, including U.S. government and investment-grade debt securities and money-market funds.
Competition: We pioneered and lead the experience management market and believe that we provide the only comprehensive offering for experience management. We built a platform that addresses the complex experience management needs of enterprise-scale organizations and continue to expand those capabilities to new verticals and enterprises of all sizes. There are other companies that actively compete with us in particular segments of the experience management market. In addition, other established technology companies not currently focused on experience management may expand their services to compete with us. As a result, the competitive landscape is fragmented, rapidly evolving and highly competitive. We expect significant competition to continue, both from current competitors as well as new entrants into the market, some of which may become significant competitors in the future. Our competitors fall into the following categories: • in-house solutions or custom-development efforts; • survey tools, such as Qualtrics (recently acquired by SAP) and SurveyMonkey; • contact center technology companies, such as Nice and Verint Systems; and • full-service consulting firms, such as MaritzCX and Towers Watson. We believe that the principal competitive factors in our market are: • breadth of platform capabilities, features, quality, functionality, scalability and design; • scope of feedback collection and process capabilities; • ability for customers to generate insights and easily act; • business impact, including speed and scale of ROI; • thought leadership, market vision and pace of product innovation; • strength of artificial intelligence and deep learning capabilities and predictive analytics; • size and relevance of dataset; • third party integrations and accessibility across software applications, operating systems and platforms; • size and sophistication of customer base across verticals and geographies; • user adoption and engagement; • security, privacy and compliance capabilities; • quality of user experience, particularly in complex, changing and high volume environments; • effectiveness of sales and marketing; • brand awareness and reputation; • ability to offer global reach; • product pricing; • professional services and customer support; • scope and strength of partner network; • ease of implementation; and • flexible deployment options. We believe we compete favorably across these factors. However, we realize that many of our current and potential competitors have competitive advantages over us, including: • greater name and brand recognition; • longer operating histories; • deeper product development expertise; • greater market penetration; • larger and more established customer bases and relationships; • larger sales forces and more established partner networks; • larger marketing budgets; and • access to significantly greater financial, human, technical and other resources. These large players could move quickly to grow their competitive solutions, either through organic development or acquisitions. At the same time, we believe smaller competitors will continue to develop new solutions that could prove more effective than those offered by us, especially in specific market segments and narrow use cases. In order to continue to lead the experience management market, we will focus on advancing our platform capabilities, investing in our sales and marketing, professional services and partner capabilities, and delivering transformative business impact.

Calendar

15 Jul 19
31 Jan 20
19 Jul 19

News

Company financial data

$93.62M
$-2.56M
$227.01M

Financial reports

No filings

Current reports

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Proxies

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Other

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