After BigCommerce's initial public offering (IPO) last week, the company has seen a massive uptick in its stock, which shot up over 200 percent. But before that, Intuit offered to buy the company for $1.5 billion, a proposal that was rejected, CNBC reported.
BigCommerce works in the field of helping eCommerce retailers with software for developing websites, handling payments and converting currencies.
According to CNBC's report, the deal was lucrative to some BigCommerce executives. But CEO Brent Bellm thought differently. He chose to wager on the odds that investors would keep piling money into the popular cloud software company's stock.
The wager wasn't unfounded. During the economic crisis this year, subscription software vendors have seen an increase in worth, with some doubling or tripling in value due to the upswing in demand for digital tools as people began to work from home.
In its IPO prospectus, BigCommerce said it is "well-positioned to continue to benefit from the macro-economic shift to eCommerce that COVID-19 has accelerated, but revenue may be more variable in the near term as a result,” CNBC reported.
If BigCommerce had taken Intuit's $1.5 billion deal, though, the company would have been valued at around 11 times revenue. That would have been a good deal for a company growing at around 30 percent annually, according to CNBC. The company was valued at around 44 times revenue on Monday (Aug. 10).
BigCommerce's chief rival, Shopify, has also been doing well, with 62 times revenue trading at the same time.
Shopify, according to CNBC, has been a Wall Street favorite for years now, with its stock price and revenue ballooning.
Earlier this month, BigCommerce's shares began soaring after the IPO. PYMNTS reported that shares began trading up 183 percent from the IPO price, making it the second-biggest gain from a company raising at least $100 million in a year when many IPOs weren't certain to go through.