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Rackspace Tanks in IPO Debut, While BigCommerce Spikes

Rackspace fell more than 20% after its debut on the Nasdaq while BigCommerce jumped nearly 300%.

Rackspace Technology RXT dropped more than 19% in a disappointing debut on the Nasdaq Wednesday, while e-commerce software developer BigCommerce Holdings spiked almost 300% in the launch of its trading.

Rackspace raised $704 million in its public offering Wednesday after pricing the 33.5 million shares it sold at $21 per share, on the low range of its $21 to $24 per share guidance range. 

The Apollo Global Management APO backed cloud computing company was taken private by Apollo in a $4.3 billion acquisition in 2016. 

Last year, the company reported revenue of $2.44 billion with a loss of $102.3 million, compared with revenue of $2.45 billion and a loss of $470.4 million in 2018. 

Meanwhile, BigCommerce Holdings BIGC jumped 283% to $91.80, opening trading at $68 per share after it priced its initial public offering of 9 million shares at $24 per share. The offering will raise $216 million.

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The company initially priced the offering between $18-20 per share before later raising that range to between $21 and $23 per share on Tuesday night. 

BigCommerce is an e-commerce, software-as-a-service company that has thousands of business-to-business and business-to-consumer companies in 120 countries. 

"Our software-as-a-service platform simplifies the creation of beautiful, engaging online stores by delivering a unique combination of ease-of-use, enterprise functionality, and flexibility," the company said in its S-1 IPO filing. "The transition from physical to digital commerce constitutes one of history's biggest changes in human behavior, and the pace of change is accelerating."

Morgan Stanley and Barclays are acting as joint book-running managers for BigCommerce's IPO, while Jefferies and Keybanc also participating as underwriters for the offering.

Underwriters have been granted 30 days to purchase up to an additional 1.03 million shares at the debut price.