Wall Street Welcomes Blackboard D.C. Company's Stock Closes Up 43% on First Trading Day
Blackboard founders Michael L. Chasen, left, and Matthew S. Pittinsky held off going public until after the Internet stock bubble burst. They are worth about $12 million each now.
(Michael Temchine For The Washington Post)
By Ellen McCarthy Washington Post Staff Writer
Saturday, June 19, 2004; Page E01
Seven years after two fraternity brothers started Blackboard Inc. in a Dupont Circle rowhouse, they watched its stock surge 43 percent in the District company's first day of trading as a public company.
Stock in the online learning company was priced at $14 a share, began trading at $15.80, rose as high as $23.38 and closed at $20.01.
The greeting Blackboard received from investors surprised some Wall Street watchers. The 43 percent gain is small in light of the triple-digit percentage increases that were typical during the dot-com boom years. But it compares favorably with other recent initial public offerings: Four out of six companies that went public this month slipped below their offering price on the first day of trading, said Richard J. Peterson, a market strategist for Thomson Financial in New York.
"This has given some IPO investors reason to rejoice," Peterson said. "If you have a product and a strong market share and expectations of some earnings growth, you're going to stand above the crowd."
The company's co-founders, Matthew S. Pittinsky and Michael L. Chasen, were in Manhattan to receive the glitzy sendoff the Nasdaq market offers its newest listings. The company's logo glowed over Times Square on Nasdaq's electronic display. Pittinsky and Chasen smiled broadly and hugged after ceremoniously signing the Nasdaq registry.
They also are multimillionaires, at least on paper. Pittinsky's shares and options exercisable by Aug. 16 are worth $12.1 million based on yesterday's closing price. Chasen's holdings are worth $12 million, according to documents filed yesterday with the Securities and Exchange Commission.
Company executives and employees emphasized they weren't succumbing to the exuberance of the dot-com era.
"Naturally, our IPO represents a milestone for this company," Chasen, the company's president and chief executive, said at the Nasdaq listing ceremony yesterday. But he added, "I am excited to roll up our sleeves and get back to work on Monday."
Employees at the company's loft-like headquarters on L Street watched the ceremony via webcam and prepared for an early evening reception that was planned to include friends and family, but not champagne.
The dot-com image has been tough to shake. When the American University graduates co-founded the company, Pittinsky was 24 and Chasen was 25. It was the apex of Internet entrepreneurship, when retiring at age 30 seemed a reasonable exit strategy.
