Unlike some of the more impressive bloggers I know, this one suffers fits and starts, especially as LeadsCon nears. Today, though is quite an important day and a closely watched one within the online customer acquisition space, and certain within the online lead generation space. Today is the day that one of its largest, if not the largest, players had a public exit.
Quinstreet, now QNST as it will be known among the financial community, did not have the easiest and certainly not the shortest path to exit. Leading up today, there were serious questions surrounding whether they would still go public. When they filed in December, the market had started to look up, but, the same jitters experienced at the beginning of 2009 came back in early 2010 forcing a number of hopefuls to shelve their offering.
QNST initially sought to raise $250mm through the sale of 10mm shares at $25. A few weeks ago, we learned that the company had repriced its offering to $17 - $19 per share. I'm not a banker, but my friends with banking experience told me that isn't a good sign. Then, there was the actual date of the filing. According the NASDAQ IPO Calendar, Quinstreet was to start trading February 10th, 2010. Well, that came and went with no sign of the company, leading those of us who really care wondering what had happened. Then news came out late last night of the official price. It was $15, another sign I was told of weak demand.
Even today, people wondered if it started trading because Google Finance, for instance, hadn't picked it up. But, it had, and in the beginning of the day, it traded up ahead of the market. In the end, QNST traded where it began, but with some pretty decent volume.
This is just the beginning, but even for some who might not like Quinstreet, as we have said before, almost everyone is hoping they do well, because it sets the stage for future exits both public and private. Now, comes a whole new level of operating stress, but they run a very efficient ship, and watching CEO Doug Valenti during their roadshow, you start to think they can pull this off.
If there is one thing we've learned throughout this process, it's that the business of lead generation is still not well understand. There is a lot of work ahead. For Quinstreet the message they give this means having them being seen not as a service provider, not as an agency but as a channel and being a leader in vertical media (owned content sites) / vertical marketing (paid media). It's taken years for us to get the space, so it's only understandable that the financial world will remain hesitant and the stock trading close to slightly lower than the open. I expect this to change, a new challenge for Valenti and company to take on.
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