EarningsNot to be all-Bentley-all-the-time, but … this is big news. This morning Bentley Systems announced that it’s filed preliminary documents with the US Securities and Exchange Commission (SEC) for an initial public offering (IPO) of its class B shares. This is a confidential filing, so we don’t know exactly what’s on offer, why it’s happening or have access to the usual financial disclosures — Bentley says the IPO will begin as soon as the SEC has finished its review but gives no indication of when that might occur. You might recall that Bentley last tried this in 2002, filing a registration document but then withdrawing it later that year when it appeared that the market’s downward trend wouldn’t give the kind of valuation the company’s owners wanted. [At least, that’s how I remember it; if you think it was something else, comment away!] Why do companies sell shares to the public? To raise money, to make it possible to reward employees with stock and options, to have bigger visibility in a world where public companies talk to investors several times a year and private companies don’t have that forum, to enable current shareholders to sell in a way that creates liquidity but preserves the majority of the remaining shareholders (that depends on who is selling what shares, and the rights associated with those shares). But there are downsides, too: investors expect quarterly progress in all sorts of metrics that often conflict with longer-term goals, so decision-making becomes skewed to a short term, 3-month at a time, focus. Too, being a public company is expensive; it’s a cost that comes straight off the top, money not spent on R&D or sales. We’ll find out a lot more about all of this when we can see the S-1 for this year’s IPO. It’s going to be an interesting summer!

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