Software company BlackLine prepares for IPO: sources

September 20, 2016 5:56 PM EDT

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By Liana B. Baker and Lauren Hirsch

(Reuters) - Accounting software maker BlackLine Inc is preparing for an initial public offering that could value it at more than $1 billion, including debt, people familiar with the matter said on Tuesday.

An IPO of Los Angeles-based BlackLine, which the sources said could come as early as October, would make BlackLine one of the first venture-backed technology firms to go public since market jitters all but shut the window for such companies at the end of last year.

BlackLine has hired investment bank Goldman Sachs Group Inc to lead its IPO, which has already been registered confidentially with the U.S. Securities and Exchange Commission, the sources said.

The sources asked not to be identified because the matter is not yet public. Representatives for BlackLine and Goldman Sachs declined to comment.

Venture-backed technology company Nutanix, which was valued at roughly $2 billion in the private market in 2014, is set to price its IPO next week.

Market conditions delayed Nutanix's IPO earlier this year, and its debut may serve as a bellwether for other venture-technology-backed companies waiting in the wings.

BlackLine was founded in 2001 by Therese Tucker, its chief executive and a former senior executive at financial technology firm SunGard, with the goal of improving the lives of accountants by eliminating drudge work. The company counts Coca Cola Co, Under Armour and Dow Chemical Co among its 1,500 customers.

BlackLine's software supports "continuous accounting," which spreads accounting tasks over a longer period of time so work does not pile up.

Earlier this month, BlackLine acquired Runbook, a Europe-based competitor.

The company has raised more than $200 million in venture capital funding from investors such as Silver Lake Sumeru, the former middle-market arm of Silver Lake that has since been spun out and renamed Sumeru Equity Partners. It also has funding from ICONIQ Capital, a family office for technology scions such as Facebook Inc co-founder Mark Zuckerberg.

While there have only been a handful of technology IPOs this year, some of the subsequent stock market performances of these offerings have made investors more confident. For example, shares of communications software provider Twilio Inc, which went public in June, are now trading nearly four times above their IPO price.

(Reporting by Liana B. Baker in San Francisco and Lauren Hirsch in New York; Editing by Leslie Adler)

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