INSUBCONTINENT EXCLUSIVE:
Scott SanbornContributor2019 has already been an active year for United States tech IPOs
Some highly anticipated unicorns, such as Uber and Lyft, have disappointed investors with their IPO debuts and their first results as public
Others, such as Fiverr, Zoom and CrowdStrike, have soared
allowing them to sell and increasing the number of shares available to trade
remarkably short period of time.I was recently at the New York Stock Exchange (NYSE) to ring the opening bell and celebrate our three-
millionth borrower on the platform
It brought back great memories from when our company, LendingClub, entered the public fray in 2014
LendingClub was the largest United States tech IPO that year, and is still one of the biggest United States tech IPOs of all time
We listed at a $5.4 billion valuation, and our shares surged 67% on the first day of trading
We were thrilled to celebrate the validation of our hard work and excited about the next stage of our growth
However, by the time our lockups expired, we had fallen back to around our IPO valuation of $15 a share.Since then, despite being the market
leader in the fastest-growing sector of consumer credit in the country with double-digit annual growth, the company today is worth less than
a fifth of what it was in 2014
We are back on track now, delivering growth and margin expansion while executing against our vision.However bespoke our story, there are
period leading up to the IPO to the period when you are expecting a baby
Intellectually, you know things will be different when you bring home a newborn
Going public is a transformational event that permanently changes your company and how the CEO, CFO and board spend their time (with obvious
From the moment we rang the NYSE bell on December 11, 2014, everything changed.Making money mattersInvestors buying your stock are
essentially valuing your future cash flow
Amazon famously lost a total of $2.8 billion over 17 straight quarters after their IPO and was the subject of a lot of skepticism and
The company maintained their strategy, delivering top-line growth and investing in their future and, suffice to say, investor patience paid
off!At LendingClub, we have invested millions of dollars to develop products that delight our 3 million+ customers (and, at 78, our NPS is
at its highest level in the history of the company) and expand our competitive moat
We are now driving toward adjusted net income profitability.Like it or not, there is a scoreboardOnce you go public, some people stop
thinking of you as a business, and start thinking about you as a stock price
And that stock price is always broadcasting
culture, but you can and must maintain the values your company holds dear. When the stock is up, everyone feels great
Communication to your stakeholders is not in the way of you doing your job, it is a critical part of your job that just got A LOT bigger
You need to stay ahead of it and deliberately carve out the time to make it a priority.There are others sharing the microphoneWhen you are
When you are a public company, a lot of voices join the conversation
You have analysts who are paid to research and think about your company, your strategy, your prospects and your value
All of these voices are speaking to your stakeholders and you need to understand what they are saying and how it should affect your own
The risk of material nonpublic information leaking means you need to find a new balance in transparency with your employees (and your
At LendingClub, we still regularly communicate as much as we can and trust our employees, but there are places where you have to draw the
line.Your competitors are listeningIronically enough, while your ability to share key details with employees is limited, you are sharing a
lot with your competition
You can expect that your competitors are taking notice and taking notes.Your scarcest resourceAs the above would indicate, being public
means that you are inevitably going to be spending less time running the business, and more time focused externally
Not a bad thing, but something you need to plan for so that you have the resources in place underneath you to maintain business momentum
you need.Your culture will change, focus on your valuesI once asked a senior Google executive advice on how to preserve culture when going
through massive periods of transition
Her advice, which I have followed and am passing on to you, is to make sure you write them down, hire against them and assess performance
against them.We started this practice years ago and it is remarkable how consistent our values have remained even as the company has evolved
We codified six core values that put the customer at the center of everything we do
You know a LendingClubber when you meet them, and it is part of what makes us great.Being a public company is not for the faint-hearted, but
being public is part of growing up
Being public legitimizes the company, unlocks liquidity to fuel growth and enables you to attract the next generation of talent
We always said that going public would allow us to deliver more value to a greater number of consumers and would lend legitimacy to our
We have facilitated more than $50 billion in loans and are still at a small percentage of our immediately addressable market
change the face people associate with finance
life in the spotlight is a wild ride
Congratulations on this step in your journey, and on to the next!
