Digital Identity Startup ForgeRock Files IPO as Losses Shrink

(Bloomberg) -- ForgeRock Inc., a maker of identity-verification software, filed for an initial public offering, disclosing shrinking losses on growing revenue.

The San Francisco-based company in its filing Monday listed the size of the offering as $100 million, a placeholder that will change when a price range for the share sale is set.

ForgeRock could seek to be valued in an IPO at $3 billion to $4 billion, or possibly higher, Bloomberg News reported in May.

The company had a net loss of $20 million of the first six months of the year, down from $36 million in same period in 2020. Meanwhile, its revenue for that period climbed to $85 million from $55 million, according to the filing.

The IPO market has been hospitable to enterprise-software firms, which make most of their money selling to other companies.

Software Outperforms

Shares of the 322 companies that have raised more than $106 billion in what is already the second-biggest year ever on U.S. exchanges are up an average of 9.5%, according to data compiled by Bloomberg. More than a quarter of that total was raised by 53 software companies, which are now up 17.5% on a weighted average basis, according to the data, which doesn’t include blank-check companies.

ForgeRock competes with Okta Inc., a public company that also makes security software to support workers who need to access corporate systems. Okta’s shares have climbed more than 13 fold since an IPO in 2017 and it’s now valued at almost $36 billion.

In April 2020, ForgeRock said it raised almost $94 million in a funding round that included investors such as Accel, Riverwood Capital, Meritech Capital Partners  and Foundation Capital. Those firms each control 5% or more of the company’s shares, according to the IPO filing.

ForgeRock was valued at more than $767 million in that round and has raised about $273 million to date, according to data provider PitchBook.

Its IPO is being led by Morgan Stanley and JPMorgan Chase & Co. The shares are expected to trade on the New York Stock Exchange under the symbol FORG.

©2021 Bloomberg L.P.