Get ready for lots of small IPOs

Matt Bowman · November 6, 2009 · Short URL:

Sarbox relief and Open Table's mini offering may set the model for post-crash public launch

 On Tuesday, the U.S. House of Representatives passed a small-business exemption to the Sarbanes-Oxley accounting rules, permanently waiving the audit requirements for all companies with market caps under $75 million.  Venture capitalists and entrepreneurs have long bemoaned the newly repealed requirements, which were intended to prevent Enron-style scandals in big companies, but have also contributed to the IPO drought among small ones. The exemption, somewhat surprisingly urged by White House Chief of Staff Rahm Emanuel in order to pass a broader regulatory overhaul bill, could widen the IPO gate.

Couple that with the unusual form of Open Table's IPO--they sold only three million shares on opening for a total of $60 million; 18 million are still owned by investors and other insiders. 

$60 million raised and only 14% of the ownership floated--that's like a big D Round. But Open Table does come away with some incredible branding as the Tech Company That Beat The Drought. This was perfect timing to pour the marketing budget into accounting to make the IPO happen.

Between Open Table's precedent and permanent SarbOx relief, I'm wondering if the SMB IPO will become standard practice.

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OpenTable is the leading supplier of reservation, table management and guest management software for restaurants. In addition, the company operates, the world’s most popular website for making restaurant reservations online.

With more than 8,000 customers throughout the United States, Canada, Mexico, United Kingdom, Germany, France, Spain and Japan, the OpenTable hardware and software system replaces pen-and-paper at the host stand. It automates the process of taking reservations and managing tables, while allowing restaurants to build robust diner databases for superior guest recognition and targeted e-mail marketing.

For diners, concierges and administrative professionals, the website provides a fast, efficient way to find available tables that meet desired criteria for cuisine, price and location at a specified time. Reservations are free and can be made around the clock. The website is directly connected to the thousands of computerized reservation systems at OpenTable restaurants. Search results reflect actual, "real-time" availability and reservations are immediately recorded in the same electronic reservation book used by the maitre'd.
OpenTable works with many distribution partners, including AOL CityGuide, Chicago Tribune's,, DiRoNA, Los Angeles Times', NYC & Company, Time Out New York, San Francisco Chronicle's,, and Yahoo! Inc.
OpenTable Europe Limited is a company registered in England and Wales with company number 5266444 and with a registered address of Carmelite 50 Embankment Blackfriars London EC4Y 0DX.