Columbia cybersecurity firm Tenable to go public Thursday

Tenable, the rapidly growing Columbia-based cybersecurity firm, could raise more than $288 million by selling stock to the public for the first time on Thursday.

Founded 16 years ago by a former National Security Agency hacker, Tenable plans to offer 10.9 million shares at $23 each in its initial public offering, according to the company. The underwriters of the offering could buy another 1.6 million shares.

The company raised the price of shares again Thursday morning. Its latest filing with the Securities and Exchange Commission indicated shares were previously expected to sell for $20 to $22. An offering priced at $23 a share values the company at nearly $2.1 billion before its stock starts trading Thursday.

Tenable is only selling about 12 percent of itself in the initial public offering. The remaining shares are owned by its venture capital backers, its founders, including former chairman and CEO Ron Gula, who is no longer with the company, and other executives and insiders.

The company helps businesses and governments monitor their networks for hacking threats. It now claims 24,000 customers, including more than half of all Fortune 500 companies.

Tenable, which is building a new headquarters in downtown Columbia, announced its intention to go public in late June.

It has not yet determined specifically how it will use the funds raised from the IPO. Generally, Tenable plans to use the funds to increase its financial flexibility — putting the proceeds toward its working capital, investing in sales and marketing, and furthering the company’s international growth, according to SEC documents.

Tenable has been growing rapidly. In 2017, the firm’s revenue grew 51 percent to $187.7 million, up from $124.4 million in 2016, according to its SEC filing. The company lost $22.2 million in 2017, though early-stage companies frequently operate at a loss as they fund their rapid growth.

Tenable also could use part of the funds from the IPO for acquisitions, or investments in related businesses or technologies, according to SEC documents. But the company said it does not now have any potential acquisitions on its radar.

Tenable last raised a significant sum in 2015, when New York-based Insight Venture Partners and Silicon Valley-based Accel Partners invested $250 million in the company.

Both venture capital firms remain Tenable’s two largest shareholders. Insight will control about 31 percent of Tenable shares after the IPO, while Accel will control about 30 percent.

The next largest shareholder is Gula, a former National Security Agency hacker who co-founded Tenable in 2002, and his wife, Cyndi Gula. Together they will own 10.1 percent of the stock after the offering. The couple stepped away from Tenable’s leadership in 2016 and founded a tech investment firm, Gula Tech Adventures.

Ron Gula did not immediately respond to a request for comment Wednesday afternoon.

Another co-founder, John “Jack” Huffard Jr., Tenable chief operating officer, who relinquished the title of president in May, will control 4.5 percent of the shares.

Amit Yoran, who joined Tenable as chairman and CEO in 2016 succeeding Gula, will own 2.9 percent of the company stock.

Tenable officials did not respond Wednesday to a request for comment on the offering.

Tenable’s stock will be listed as “TENB” on the Nasdaq Stock Market when shares begin trading Thursday.

smeehan@baltsun.com

twitter.com/sarahvmeehan


UPDATES:

8:30 a.m. July 26: This story has been updated to reflect Tenable increasing the offering price to $23 a share.

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