451 CAOS Theory 
A blog for the enterprise open source community
Open and public
Raven Zachary, July 5, 2006 @ 11:17 pm ETTrolltech, an open source company focused on the cross-platform and mobile development tools space, had its initial public offering today on the Oslo Stock Exchange (OSE: TROLL) today. Shares were offered at 16 NOK (Norwegian Kroner), which is approximately $2.57 US, and closed on its first day slightly up at 17.50 NDK, approximately $2.81 US. You can check out the press release. The press release is in English, although my link to the Oslo Stock Exchange is in Norwegian. However, the numbers on the OSE page should be somewhat easy to discern. I don’t have a translation URL for you, as the ones I tried didn’t work very well.
While I’m on the topic of public open source companies, I should mention that Red Hat announced its quarterly earnings last week (press release). Shares have been down a bit since the earnings announcement as the results were below some analyst estimates. Also, the acquisition of JBoss had a greater impact on the dilution of their earnings than previously expected.
Watching Red Hat has always been interesting because it’s really the only public company with an entirely open source focused business model. I guess we can now add Trolltech to this list, although it’s not on the US markets. Other public companies have open source plays, but only as part of their overall business.
Matt Asay recently mentioned a research note from JMP Securities on his blog entry, “The Walking Dead“. One of the excerpts that Matt shared from the JMP Securities piece was a chart entitled “Open Source Revenues Relative to Valuation”, which looked at eleven public companies and the contribution that open source business contributed to overall revenues. However, only two of the companies listed had more than a single-digit percentage of their revenues derived from open source activities - Red Hat and VA Software.
Someday I hope to put together an “open source fund” tracking the various public open source companies and other public companies with a significant open source aspect to their business. The data in the JMP Securities graph could form the basis for an open source fund, whereby the calculation of the fund total followed the open source contribution to revenue as a percentage of the stock price per company. But, to do this right we need a few more IPOs (or major business shifts). I wonder who will go public next.
Categories: Funding, IPO, Software
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You are correct that the shares opened at NOK 16 per share, but that is only US$2.57. The shares actually closed at NOK 21, which is US$3.40.
Here is a link to the Trolltech’s chart on the Oslo stock exchange in English: http://www.oslobors.no/ob/aksje_kursutvikling?menu2show=1.1.2.1.&p_instrid=ticker.ose.TROLL
Those numbers give Trolltech an opening market cap of about $131.37 million (there are a total of 51,104,028 shares outstanding) and a closing market cap of about $172.1 million.
Hi Erica - thanks for the correction on the conversion. I was doing the math in reverse, accidentally. I have fixed this. Are you sure it closed at 21 NOK yesterday? The charts showed 17.50 and if you look at todays chart, you’ll see that the day started just over 17.50 and has since climbed to 21.
Also - I looked at the link you embedded into the comment and it’s not in English. Can you repost?
Sorry about the link - I figured out what happened. You have to click on the British flag near the upper right corner of the page (it is difficult to see at first.) When I click on the link, it shows it to me in English because I had already clicked that button.
You are also correct about the stock. I was thinking that the IPO was today - I should have paid more attention to the date (on your article as well as the IPO announcement.) I apologize for the oversight.
Nice article, thanks
On a slightly tangential note, making revenues from free & open source software is one of the most frequently asked questions these days. While there have been a few successful examples of companies (like MySQL, Red Hat etc) which are making money, I’d surmise that these are still very early days for open source revenue & profit models.
While open source as an operational paradigm certainly has been having exceptional success against proprietary and closed-software models in the recent past, in my opinion, a lot more thought need to be given and experimentations done before the emergence of viable revenue models for the free & open source models that can successfully compete with the current proprietary software revenue model. Some specifics of the business models are emerging fast, but it will take a few years for the market to test each of these out and hopefully, the fittest will survive.
A site that focuses exclusively on revenue models from open source is Follars.com – Free, Open-source Dollars!
Ec @ IT, Software Database @ eIT.in
Open Source companies should make money at the end of the day, don’t they? In the meanwhile I’ll stick to stock trading chart system to monitor their prices and profit from it..
BP
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