Roku Seeking Secretive IPO: Report

Could Raise Up To $150 Million (Updated)
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Roku is preparing to file a confidential initial public offering that could raise as much as $150 million,The Wall Street Journal reported Friday (October 24), citing sources familiar with the plan.

According to the paper, the maker of streaming media players and a software platform that now supports more than 1,800 “channels” has been working with a number of investment banks, including  Bank of America Merrill Lynch and Citigroup, on the offering, but warned that the timing of an IPO isn’t yet set. Roku has been asked to comment on the report (Update: Roku declined to comment).

The New York Timesnoted that Roku could try to keep its business details secret via the Jumpstart our Business Start Up Act, which was enacted on April 5, 2012, and covers “emerging growth” companies with less than $1 billion in total annual gross revenues.

Roku, which is battling in the market with the Apple TV, Amazon Fire TV, the Google Chromecast and an expected batch of products based on the Android TV platform, has been rumored to be seeking an IPO in recent years. Of recent note, Bloomberg reported in February that Roku could pull the trigger on an IPO later in the year, noting at the time that the company was merely weighing the idea and had not yet selected a lead banker.

In the meantime, Roku has been raising money in other ways. Last week, an SEC filing showed that Roku scored an additional $25 million, extending its total past the $150 million mark. A spokesperson confirmed that the latest batch of funds was for “additional growth capital,” but didn’t elaborate.

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Roku hasn’t posted its financials, but told The Information (subscription required) that it pulled in $190 million in revenues in 2013, that it was nearing profitability, and that the company expected services, rather than hardware sales, to drive the business within the next year to 18 months.

Roku has sold more than 10 million of its players in the U.S., but has not disclosed international sales figures.

On the product front, Roku launched a $49.99  HDMI-connected Streaming Stick in March, and simplified its box lineup last fall. Last month, the company announced the Roku Powered program, an initiative aimed at helping Roku strike up direct partnerships with pay-TV providers. Roku is also trying to expand the reach of its platform through TV integration deals.

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