DigitalOcean Holdings (DOCN) - Get DigitalOcean Report started its first day of trading on a down note Wednesday with shares of the cloud computing company dropping below their initial public offering price.
Shares of the New York company were sliding 7.1% to $43.69 at last check.
DigitalOcean said that it had sold 16.5 million shares Tuesday for $47 each. The company had marketed the shares for $44 to $47 and said it had raised more than $775 million in the IPO.
Founded in 2011, DigitalOcean said it now has more than 570,000 customers in more than 185 countries. Two-thirds of the company's revenue has historically come from customers located outside the United States.
"Our users include software engineers, researchers, data scientists, system administrators, students and hobbyists," the company said.
DigitalOcean said revenue has grown over the past three years. The company reported a loss of $43.6 million on revenue of $318.4 million last year, compared with a loss of $40.4 million on revenue of $255 million in 2019.
DigitalOcean said it has also crossed $357 million in annual recurring revenue and achieved 30% adjusted Ebitda margin in 2020.
The company’s largest stockholder, with a 22% stake after the offering, will be an affiliate Access Industries Holdings LLC, which was founded by the businessman and investor Len Blavatnik.
Other backers include funds connected to venture capital firms Andreessen Horowitz and IA Venture Partners.
The company said it has established itself "as a top developer learning community" with over 34,000 developer tutorials, technical guides and community-generated Q&A.
Globally, 43 software companies have raised a combined $14 billion in IPOs since Jan. 1, according to Bloomberg.
This number includes 11 listings raising $8.65 billion on U.S. exchanges, led by Playtika Holding's (PLTK) - Get Playtika Report $2.16 billion IPO and Qualtrics International's (XM) - Get Qualtrics International Inc. Report $1.78 billion share sale.