Earlier this year, shares of traditional software-as-a-service (SaaS) companies faced a decline as investors expressed concerns about the potential threat posed by AI-driven software. In contrast, Bending Spoons, a firm focused on acquiring and rejuvenating underperforming tech brands, witnessed a significant rise in its shares during its market launch.
On Wednesday, its shares closed at $40.50, marking a nearly 40% increase from its $29 initial public offering (IPO) price. With this valuation, the 13-year-old company based in Milan has reached a market capitalization of $25.7 billion, surpassing its previous private valuation of $11 billion. Through its offering, Bending Spoons successfully raised $1.68 billion.
Bending Spoons has rapidly expanded by taking over well-known brands that have seen better days, such as AOL, Eventbrite, Evernote, Meetup, and Vimeo. The company revives these brands, primarily through aggressive cost management, introducing new features, and adjusting pricing. Although its strategy is reminiscent of private equity, Bending Spoons intends to retain ownership of these companies rather than sell them off.
The company’s disclosed finances reveal its effective management of its growing portfolio. For the first quarter, Bending Spoons reported revenues of $601 million, resulting in a net income of $27.4 million. This is a remarkable recovery compared to the same quarter last year, which saw a net loss of $112 million on $259 million in revenue, as recorded in SEC filings.
The name Bending Spoons is inspired by a memorable scene from the science-fiction film “The Matrix.” In the past year, the bulk of its revenue—84%—was derived from subscription services.
Before its IPO, Bending Spoons had Baillie Gifford as its largest external shareholder, along with minor stakes held by Renaissance Partners, Cox Enterprises, Durable Capital Partners, Fidelity, and T. Rowe Price.
The IPO has also resulted in substantial financial gains for the company’s five co-founders: Luca Ferrari, Francesco Patarnello, Matteo Danieli, Luca Querella, and Tomasz Greber.
In addition to Bending Spoons, several other investors adopt a similar strategy focused on acquiring and revitalizing struggling software companies, commonly referred to as “venture zombie” businesses. Notable instances include firms like Constellation Software, Curious, Tiny, saas.group, Arising Ventures, and Calm Capital.
