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Usability testing platform UserTesting sets terms for $227 million IPO

November 8, 2021

UserTesting, which provides an enterprise-grade SaaS platform for usability testing, announced terms for its IPO on Monday.

The San Francisco, CA-based company plans to raise $227 million by offering 14.2 million shares (29% secondary) at a price range of $15 to $17. At the midpoint of the proposed range, UserTesting would command a fully diluted market value of $2.7 billion.

UserTesting states that it has pioneered a video-first, enterprise-grade SaaS platform that enables organizations to see and hear the experiences of real people as they engage with products, designs, apps, processes, concepts, or brands. Its go-to-market model is based on a direct sales force that is optimized for the size and geography of a customer's organization. It has also started investing in creating channel partnerships and relationships with resellers, distributors, and strategic partners to broaden its reach. As of September 30, 2021, UserTesting had more than 2,100 customers, including 279 with at least $100,000 of ARR and nine with at least $1 million of ARR, and a 119% net dollar-based retention rate.

UserTesting was founded in 2007 and booked $134 million in revenue for the 12 months ended September 30, 2021. It plans to list on the NYSE under the symbol USER. Morgan Stanley, J.P. Morgan, Piper Sandler, Truist Securities, William Blair, Canaccord Genuity, Needham & Co., Oppenheimer & Co., Raymond James, and Baird are the joint bookrunners on the deal. It is expected to price during the week of November 15, 2021.