It's been 20 years since David Duffield's last company, enterprise software firm PeopleSoft, went public. Back then, in 1992, Duffield was only five years removed from founding that company and mortgaging his house to fund the startup that would make him his first billion dollars.
Today, cash problems seem a distant past for a man who has returned to the helm of a public company--and made a hefty return doing so--when his software firm Workday began trading on Friday.
Duffield's new enterprise software firm, the Pleasanton, Calif.-based Workday, which priced at $28 a share on Thursday and trades under WDAY on the New York Stock Exchange, was up more than 71% from its offering price as of 12:40 PM Eastern Time. For Duffield, who started the company after Oracle acquired PeopleSoft for $10 billion in 2005, Workday's public offering translates into a significant boost in his net worth, and perhaps vindication that shunning retirement after Larry Ellison's acquisition was the right decision.
According to a financial document filed with the Securities and Exchange Commission, Duffield owns more than 70.1 million shares, or nearly 44% of the 160.3 million outstanding shares following the initial public offering. With the stock at $47.91, Workday's cofounder and co-CEO's stake is worth more than $3.36 billion, a figure that may rise if the stock performs well on its first day of trading. The 72-year-old Duffield, who was worth $2.1 billion as of last month's publication of The Forbes 400, is now worth an estimated $4.5 billion.
Cofounded in 2005 by Duffield, Workday provides cloud-based human resources, payroll and financial management tools. In its offering, the company plans to sell 22,750,000 shares of common stock, a $637 million offering that values that company at almost $4.5 billion. Duffield did not sell any shares during the IPO.
Duffield, who shares the CEO position with Workday cofounder and Greylock Partners venture capitalist Aneel Bhusri, maintains control of 61% of the company's votes due to agreements with Bhusri, and his ownership of supervoting Class B shares as outlined in the firm's S-1 statement. A spokesman for Workday and Duffield could not be reached for comment.
Workday generated $119.5 million in revenue in the six months ending July 31, up from $54.8 million in the period a year ago. The company posted a net loss of $47.3 million over the six months ending July 31, compared to $36.3 million in the comparable period.
One of the most closely watched private tech companies since Facebook's disaster in May, Workday is the latest enterprise software firm to begin public trading in recent months. Splunk, ServiceNow and Palo Alto Networks have done relatively well since their public debuts as investors seek out growth in the trend toward cloud computing. On Thursday, Workday priced shares at $28, above the $24 to $26 range announced earlier in the week.
Tomio Geron contributed to this story.
Follow me on Twitter at @RMac18.
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