Updated from 2:21 p.m. EST
SAN FRANCISCO -- NetSuite raised $161.2 million in its initial public offering on Wednesday, giving the company a market cap of $1.55 billion.
The San Mateo, Calif.-based company, which issued 6.2 million shares, priced them at $26 in a Dutch auction-style IPO, well above its recently adjusted price range. The stock will trade Thursday under the ticker (N - Get Report).
The stock had been expected to go out at between $19 and $22, already well up from its original base of at least $12 per share, according to MorningNotes, an IPO information service.The small size of the offering, the narrow distribution channel and the celebrity of the company's chief investor added to the IPO's excitement, MorningNotes' publisher Ben Holmes wrote Monday. The celebrated investor is none other than Oracle (ORCL - Get Report) CEO Larry Ellison, who with his family owns 66% of NetSuite following the IPO. His name gave the offering by this small, unprofitable company an extra measure of buzz, but also raised expectations. The question for potential shareholders is whether NetSuite can justify the high price. Founded in 1998, NetSuite, which has 5,400 clients, is the latest subscription-based on-demand software company to come public. Such software is sometimes referred to as cloud computing. NetSuite hosts business-management software over the Internet that helps subscribers handle back-office functions, such as accounting and payroll, as well as web commerce and customer relationship management (CRM).