Shares of software company Amplitude made waves on their first day of trading on Tuesday, gaining 9.6% at the closing bell.
The shares gained $ 4.80 (£ 3.55) per share on top of its opening price of $ 50 (£ 39.88) per share.
Yesterday, the NYSE listed the company at a benchmark price of $ 35 per share.
Direct listings became more popular after the Securities and Exchange Commission (SEC) approved a offers NYSE Group rule to allow companies to raise capital on Wall Street in December 2020.
This method allows companies to bypass the often expensive route of paying Wall Street banks numerous deposit and banking fees before an initial public offering (IPO).
Because Amplitude chose to go the direct listing route, the company did not raise any money through its offer.
Amplitude CEO Spencer Skates said in a maintenance with MarketWatch that traditional IPOs are “archaic” and often lead companies to undervalue their stocks.
Amplitude spokesperson Julie Sellew confirmed Skates’ sentiments to Capital.com.
Amplitude describes itself as a “digital optimization system” that leads the “digital disruption movement”, according to its website.
Among the company’s customers is Burger King, a global fast food chain that uses Amplitude to transform “details about customer transactions, customer preferences and buying habits into actionable data insights, ”the website says.
Amplitude’s platform generates measurable results for its customers. Social fundraising platform GoFundMe saw its donation volume increase by 5% after using the platform, the website adds.
In the last quarter, the company generated more than $ 39 million in revenue, according to its income statement. This total represents a 66% year-over-year increase.
The company also has additional performance obligations of $ 119 million for the remainder of the year, an increase of more than 76% from last year, the release said.
Read more: Amplitude seeks to raise $ 1.25 billion in direct listing on the Nasdaq
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