As IPO Market Thaws, Carbonite Files to Go Public with Growing Data-Backup Business

Han Solo was once frozen in “carbonite.” Now Boston’s namesake tech company is emerging from a different kind of deep freeze.

When we last spoke this winter, David Friend said his online data backup firm, Carbonite, was in the late stages of filing for an IPO. The man is true to his word.

Boston-based Carbonite has indeed filed its S-1 registration statement with the SEC and is officially planning to go public as of today. According to the form, the proposed maximum offering is $100 million, but that doesn’t mean much right now. The company isn’t saying yet how many shares it will offer, or the price range for the offering, but if all goes well, its stock will trade on the Nasdaq under the ticker symbol CARB.

The tech IPO market appears to be thawing in New England after a nearly two-year freeze. In recent months, Connecticut-based travel firm Kayak has filed to go public, and Cambridge, MA-based Zipcar held its initial public offering last month. (Meanwhile, e-mail software firm SMTP took a much less conventional route to its IPO a couple weeks ago.)

But back to Carbonite. The company, led by Friend the CEO, has raised more than $67 million in venture capital to date. It first rolled out its data-backup service for consumers in 2006, and more recently has increased its focus on business customers, who Friend said account for between one-third and one-half of Carbonite’s total revenue. Its main competitor over the years has been Mozy (now part of Hopkinton, MA-based EMC). As of January, Carbonite had about 160 employees in Boston, plus some 200 additional full-time equivalents.

More recently, as of April 30, Carbonite had more than 1 million subscribers (both consumers and business users) in more than 100 countries, according to its SEC filing. The company says it has backed up more than 100 billion files since 2005, restoring 7 billion-plus that might have been lost forever. It currently backs up more than 200 million files a day worldwide.

Carbonite is not yet profitable, but its business is growing. The company had revenues of $38.6 million in 2010 (up from $19.1 million in 2009), and $12.8 million in the first three months of 2011. It incurred a net loss of $25.8 million last year, and $5.3 million in the first quarter of this year. The company says the losses are primarily because of large investments in advertising to acquire customers.

A few other strategic nuggets from the SEC filing: Beyond the U.S., Carbonite plans to roll out a data-backup product for businesses in China over the next year. And it plans to start marketing in Europe in 2012. Another big potential growth area is backing up smartphones and tablet computers. The risks to Carbonite’s business, according to the form, include not bringing in enough new customers, not retaining customers, not gaining widespread adoption on mobile devices and with business users, and data security issues.

If the IPO goes through, a number of investors and company execs stand to gain from it. Menlo Ventures, led by managing director Pravin Vazirani, is the lead investor and owns 31.7 percent of the company. Performance Direct Investments owns 5.8 percent, Crosslink Venture Partners owns 5.7 percent, and First Plaza Group Trust is next in line with 5.4 percent. Among executive officers, CEO David Friend and chief architect Jeff Flowers are tops with 9.7 percent and 8.3 percent of the stock, respectively.

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