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SAP-owned experienced management software Qualtrics to go for an IPO this year. The company will be still operated by its co-founder Ryan Smith and the firm’s current management team.
The acquisition of Qualtrics by German software giant SAP SE (NYSE: SAP) for $8 billion shortly before its IPO in 2018 comes with many plans, top of which has just been unraveled. In a Sunday press release, SAP announced it intends to Spin-out Qualtrics in a brand new Initial Public Offering IPO. SAP would continue to have majority ownership of Qualtrics following the IPO, which it said it plans to conduct in the U.S.
While the company has confirmed that the final decisions on the IPO based on its proposed conditions and timing are pending and subject to market conditions, the firm believes the move will help consolidate Qualtrics operations as it will be able to expand its footprint both within SAP’s customer base and beyond.
Qualtrics founder Ryan Smith also plans to be the largest individual shareholder in Qualtrics as He and the company’s current management team will retain control of the company post IPO. With the spin-out, SAP’s hopes to boost long term revenue through the Qualtrics product and service offerings are still well preserved.
What Makes Qualtrics Special
Qualtrics was founded in 2002 by Scott M. Smith, Ryan Smith, Jared Smith, and Stuart Orgill. The company has a unique niche as an experience management (XM) company, with co-headquarters in Provo, Utah, and Seattle, Washington, in the United States. Qualtrics offers a subscription software platform, and it became the first employee management platform measuring employee experiences through key metrics powered by predictive intelligence.
Researchers often use Qualtrics as a survey tool and combine it with SPSS to analyze their survey data on employee experiences and many other types of survey data. These and more unique experiences attracted it to SAP who wielded big cash to acquire it just four days before it was billed to go public in 2018.
“Ever since we founded Qualtrics, our goal has been to help companies have a conversation at scale about the experiences their employees and customers are having and leverage our system to take action. This is an exciting time to be part of Qualtrics and SAP, and we’re excited to continue building out the XM ecosystem,” co-founder and CEO Ryan Smith told Forbes.
Since becoming a part of the SAP family, Qualtrics has been consistently seen as the bright spot of the software giant’s business as the need for cloud services and digital experience management has skyrocketed in the wake of the coronavirus outbreak.
Expectations as Qualtrics Goes for IPO
In the official statement provided by the company, SAP CEO Christian Klein expressed his optimism about the future business prospect associated with the decision to take Qualtrics public. He said:
“SAP will remain Qualtrics’ largest and most important go-to-market and research and development (R&D) partner while giving Qualtrics greater independence to broaden its base by partnering and building out the entire experience management ecosystem.”
The world’s workspace has been redefined and has gone digital as businesses switched to virtual working environments, a positive turn creditable to the COVID-19 induced lockdowns. With this current state of things, a publicly listed company will provide Qualtrics with enough capital base for it to harness the opportunities that will make it endearing to clients who need its product offerings.
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