Schrödinger, a US-based life sciences software provider that counts pharmaceutical firm Wuxi AppTec and internet and technology group Alphabet as investors, went public yesterday in a $202m initial public offering.
The IPO consisted of almost 11.9 million shares priced at $17.00 each, above the $14 to $16 range the company set last week. The company’s shares ended their first day of trading on the Nasdaq Global Market yesterday at $28.64, giving it a market cap of about $1.38bn.
Founded in 1990, Schrödinger produces computational software that drug developers use to make the discovery of relevant molecules more efficient. It increased revenue 21% to $59.7m in the first nine months of 2019 while cutting its net loss slightly to $18.5m.
Alphabet subsidiary GV and Wuxi AppTec’s Corporate Venture Fund both took part in the company’s last round, a $110m series E round that closed in May 2019.
Bill & Melinda Gates Foundation led that round, which also featured Tubus Management, Laurion Capital Management, Invus, Pavilion Capital, Deerfield Management, Qiming Venture Partners and Baron Funds.
Cascade Investment, the personal investment vehicle for Bill Gates, provided $10m in funding for Schrödinger in 2010 before Gates himself led a $20m round for the company in 2012 and a $22m round three years later.
The only two investors in Schrödinger to hold stakes greater that 5% pre-IPO were David E. Shaw, owner of hedge fund D.E. Shaw, whose 45.3% stake was diluted to 34.2%, and Bill & Melinda Gates Foundation, whose 17.6% share of the company was cut to 13.2%.
Joint book-running managers Morgan Stanley, BofA Securities, Jefferies and BMO Capital Markets Corp have 30 days to buy up to 1.78 million more shares. If they fully take up that option the size of the offering will rise to approximately $232m.
