In the enterprise technology industry, the most noteworthy IPO of the year so far is one that didn’t happen — Globoforce. As a category leader in rewards and recognition, its IPO was anticipated to be a landmark moment — the first major publicly traded company in the category. However, when the company abruptly postponed its IPO on March 20 citing unfavorable market conditions, many people in enterprise technology circles were confused. We believe it’s important to explain what’s going on at all levels, and we hope that this analysis will bring some clarity and sanity to the discourse. Want to learn more? Download the full Industry Bulletin from The Starr Conspiracy Intelligence Unit.
How could market conditions be more favorable than right now? We’re seeing the best IPO market in 15 years, and enterprise technology companies that focus on HR and HCM — such as Workday and Cornerstone OnDemand — have been among the market’s hottest IPOs recently for a reason. These are fast-growth companies that address a significant market need. Demand for integrated, cloud-based HR and HCM solutions is growing rapidly as businesses see the benefits and value these technologies create — reducing risk and cost, increasing efficiency and agility, and making it easier to attract, retain, develop, and engage talent. Depending on whose numbers you cite, the total addressable market for HR/HCM technologies is $14 billion to $24 billion. However, IDC expects the market size for recognition solutions alone to reach $32 billion by 2016. And TSCIU actually believes the total addressable market is much higher for both.