A Provo-based company that develops and markets software that helps companies understand how to keep customers satisfied, is going public. Qualtrics has filed the necessary paperwork with the U.S. Securities and Exchange Commission to raise $200 million through an initial public offering. The IPO is generally expected to be the largest in history for a Utah company with tech industry publications estimating the company’s valuation at about $2.5 billion.
Qualtrics was founded in 2002 by current CEO Ryan Smith and his college roommate, Scott M. Smith, with the stated goal of making “sophisticated research simple for the academic market,” according to the filing. The company later expanded beyond the academic world to serve corporations with core products focused on improving experience in the areas of customers, products, brands and employees. It competes against products such as Medallia and SurveyMonkey and marketing research firms such as Aon Hewitt and Towers Watson.
In 2016, Ryan Smith was named No. 12 on Fortune magazine’s 40 Under 40 listing.
Although originally founded in Utah, the company opened a “co-headquarters” in Seattle in 2015 where it now employs over 300. Earlier this year, the company also opened a European engineering center in Krakow, Poland. Qualtrics now employs over 1,800 in its various operations.
Qualtrics brought in net profits of $2.5 million on just under $290 million in revenue in 2017, according to the IPO filing. For the first half of 2018, Qualtrics brought in more than $184 million in revenue, $53 million more than it reported a year prior. The company has raised $400 million over its lifetime, including a $180 million round in 2017, and its backers include Accel, Insight Venture Partners and Sequoia Capital.
“With the introduction of new technologies and the evolution of our solutions and new market entrants, we expect competition to intensify in the future,” the company wrote in its IPO filing. “We also anticipate that potential competition may come in the future from incumbent software providers.”
Qualtrics’ initial offering of $200 million in the prospectus filed with the Securities and Exchange Commission will likely change when they actually go to market, industry analysts predict. Company officials have not yet announced details of the offering or what share prices will be, but Qualtrics will be traded under the ticker symbol “XM,” which the company said stands for “experience management.”
Qualtrics is the third Utah tech company to announce that is going public this year. Tech education company Pluralsight went public in May, with an offering over $350 million, and business analytics company Domo went public in June at nearly $200 million in its initial offering.