After floating at $0.50, shares briefly hit $2.60, valuing the company at $1.1 billion, before they settled back to close at $1.60. That means a market capitalisation of almost $700 million.
In September founder Matt Barrie turned down an offer of $430 million from Japanese company Recruit Co. It seems he made the right decision. He owns 46% of the company, which means his stake is worth $320 million.
Only 7% of the shares were floated, raising $15 million. The prospectus says the money will be used to fund expansion, and also that its revenues last year were just $18 million. This was up from $11 million last year. That means a massive multiple on earnings for the float.
Only around 4% of Freelancer.com’s business is in Australia. It has become an international phenomenon, described by Barrie as ‘eBay for jobs’. He said he had rejected ‘hundreds’ of offers for the company over the past few years. He told Fairfax Media at the time he turned down the Recruit Co offer that none of them had been from Australia.
Barrie has been extremely critical of the local IT scene and of the poor record of Australian governments in supporting the local industry.
The float makes Barrie a very wealthy man and probably Australia’s most financially successful IT entrepreneur. Also better off is fellow investor Simon Clausen, who founded PC Tools and sold it to Symantec for nearly $300 million, and chief technology officer Darren Williams.
Barrie founded Freelancer.com only six years ago, and grew partially by acquisition of similar sites around the world. He has been a regular public speaker, enthusiastically spruiking the way the Internet will change people’s lives. It has certainly changed his.