Avenue A, net.Genesis, Niku Stocks Soar in IPOs

A number of surging new issues rebooted the IPO market Tuesday and set the pace for a week of strong candidates.

Two of Tuesday's three big winners are in the controversial business of gathering information about online visitors that has led the Federal Trade Commission and class-action lawyers to scrutinize competitor DoubleClick(DCLK Quote).

Avenue A(AVEA Quote), an Internet advertising company, tripled on its first day. net.Genesis (NTGX Quote), another online intelligence gatherer for advertisers, surged 216%. AndNiku(NIKU Quote), which provides software for technology consultants, gained 188%

The strength of these new issues may bode well for this week's initial public offering of Palm, the maker of the Palm Pilot electronic organizer. Palm's parent, 3Com, saw its stock price soar 18 15/16, or 24%, to 98 Tuesday in anticipation of the Palm offering.

Avenue A shares shot up 48, to close at 72. The company sold 5.25 million shares at an offering price of $24. The company doubled its offering price from the initial $10-to-$12 range following strong institutional demand.

The lead underwriter, Morgan Stanley Dean Witter, and Avenue A raised $126 million and watched the market capitalization climb to $4 billion.

The company offers Internet advertising services to help customers make the most of their online advertising budgets. Among its services are online media buying and planning, advertising serving and advertising campaign analysis. Customers for these services include Gateway(GTW Quote), Microsoft(MSFT Quote), and uBid(UBID Quote).

Avenue A's precision targeting program enables its clients to aim online ads at the specific preferences of Web surfers. One of Avenue A's biggest hurdles will be negotiating the storm of complaints over consumer privacy on the Internet.

Nicolas Hanauer, the company's chairman; Michael Galgon, senior vice president, and Scott Lipsky, now the chief of technology, founded the company in 1997. Hanauer owns about 13% of Avenue A while affiliates of Oak Investment Partners own 16% and U.S. Venture Partners owns about 9%.

net.Genesis ran up 38 13/16, to close at 56 13/16. The company, based in Cambridge, Mass., gathers intelligence about Web visitors that enables companies to understand and improve their online businesses.

The lead underwriter, Hambrecht & Quist, helped the company raise $76.5 million through the sale of 4.25 million shares at $18 apiece.

Charles Schwab(SCH Quote), General Electric(GE Quote), E*TRADE(EGRP Quote) and Disney(DIS Quote) use net.Analysis software by net.Genesis to hone marketing campaigns and provide personalized content to online visitors. net.Analysis tracks visitor buying and surfing behavior and blends that data with other customer information to generate profiles of different types of customers.

net.Genesis gets about 40% of revenue from its consulting services. IBM(IBM Quote) and DoubleClick are among the company's strategic partners. Prominent shareholders include Charles River Partnership with about 15%, OneLiberty Ventures, and Bessemer Venture Partners.

And Niku's shares gained 45, to close at 69, putting the new company's market capitalization at $4.7 billion.

Niku, based in Redwood City, Calif., more than doubled its offering price to $24 from an earlier range of $10 to $12. The company sold eight million shares, taking in $192 million from the offering underwritten by Goldman Sachs.

Its largest customers include USinternetworking(USIX Quote) and Sybase(SYBS Quote).

The company also has a Web site, iNiku, that enables contractors and clients to negotiate proposals and manage projects. Niku hopes to place its software with advertising agencies, law firms and other markets.

The company's founder and chief executive, Farzad Dibachi, owns 17% of Niku. He was a senior vice president at Oracle(ORCL Quote) before he was 30.