Carbonite Expected to Go Through With Smaller IPO; Venture Investors See Upside

[Updated 8/10/11 5:50 pm. See below.] What’s happening with Carbonite’s IPO?

The Boston-based online data backup firm is dealing with an extremely volatile stock market this week—as are a bunch of other U.S. companies trying to go public. But it’s looking like Carbonite’s initial public offering could go through tomorrow at a much reduced price, with pricing of shares expected tonight, according to Renaissance Capital. At the same time, some of the company’s venture investors are taking the opportunity to buy a bigger slice of the pie.

Carbonite priced its offering of 6.25 million shares at $10 per share, raising $62.5 million, Reuters reported late today [Sentence added to update news of Carbonite’s pricing]. According to an SEC filing today, Carbonite’s expected price per share was between $10 and $11, down by about a third from the figure of $15 to $17 proposed last month. That means the stock offering (7,187,500 shares) was expected to be worth a maximum of about $79 million, down from the $122.2 million expected previously—and down from the $100 million stated in the firm’s original S-1 filing back in May.

Carbonite’s venture investors don’t seem too worried. In fact, Menlo Ventures, the company’s largest stakeholder (31.7 percent as of June 30), wants to buy up to 800,000 additional shares, and Crosslink Capital (5.7 percent) wants to buy up to 1.2 million more shares, according to today’s filing. That would seem to suggest they have good confidence in the deal. Another data point from the filing is that Institutional Venture Partners bought 863,832 shares of Carbonite common stock at $12 per share back in January.

It’s a tough time for any company to be going public. But Carbonite has a solid track record of technology and products, and its business has been growing although it is not yet profitable. While the market conditions are troubling—and maybe because of that—the company’s leadership seems to think the time is now to go out, get the deal done, and go from there.

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