Last week, AvidXchange became the newest domestic company to go public.
The company debuted on the Nasdaq under the ticker AVDX.
Why it matters: The IPO of the local fintech company marks the latest step in Charlotte’s development into a technology city. In recent years, the city has welcomed major tech job additions from companies like Centene, Lowe’s. Arrival, Better.com and Moodys.
Charlotte has come a long way in the past few decades, and the local economy is now fueled by much more than just banking.
Councilor Tariq Bokhari, who heads the fintech-focused non-profit organization Carolina Fintech Hub says AvidXchange’s IPO has significant trickle-down effects for the city’s entire technology industry.
“In the short term, we will benefit enormously from awareness alone,” says Bokhari.
That said, if tech leaders overseas or across the country had never heard of Charlotte, now they can associate it with big names like AvidXchange, he adds.
- Groups like the Carolina Fintech Hub have been working for years to grow the city’s tech brand and support startups. Last week the group did started an accelerator program called Meta Lab, which will work with partners like US Bank to help startups with things like business development and recruiting.
Flashback: In 2000, entrepreneurs Michael Praeger and David Miller founded AvidXchange, which focuses on the automation of invoice payment and invoicing systems for medium-sized companies.
- “It was just two people who met in a coffee shop in Charlotte and had a wild idea how we could change the way companies do business,” said Praeger, the company’s CEO, during a ceremony last week at the company’s headquarters in Charlotte.
- The company grew organically over the years and through acquisitions, including Salt Lake City-based Piracle, that of AvidXchange acquired in 2014.
- AvidXchange moved into its newly built headquarters in the Music Factory in 2017.
Sometime this year the company will be valued reached $ 1 billionwhat makes it a so called unicorn.
2018, the company announced plans to open a corporate office in Salt Lake City, as I wrote for the observer at the time. Also this year the company announced plans to rent 1,200+ new employees who will double their local footprint over five years in exchange for more than $ 22 million in state and local incentives.
Today AvidXchange employs 1,500 people in seven office locations, including more than 1,000 in Charlotte, said spokeswoman Chelcee Coffman.
The IPO will likely usher in further growth for AvidXchange.
In one Securities filing Last month, the company announced that it intends to use the proceeds from the IPO for staffing, sales and marketing investments, product development, acquisitions, and other purposes.
- “Today is the day every tech entrepreneur dreams of when he starts his business,” said Praeger during the IPO ceremony last week.
AvidXchange declined to make executives available for an interview with Axios. In an email, Coffman made a statement describing the IPO as an “incredible milestone” for the company.
“We continue to strive to connect buyers and suppliers through our two-way network to enable electronic payments and act as a catalyst for digital transformation,” said the company’s statement.
The big picture: AvidXchange’s IPO also offers significant profit to the company’s early investors, whom Praeger admitted last week as “very, very, very patient” over the years.
Nearly two decades ago, Charlotte executives in a number of industries each invested at least $ 50,000 in a fund “aimed at making big returns by investing in young companies,” like the Charlotte Ledger recently reported.
- One participant estimated that the initial $ 50,000 investment in the entire fund is now worth nearly $ 500,000, according to Ledger.
- In addition, Praeger owns approximately 7.4% of the company’s stock, which is now valued at approximately $ 350 million, according to the Observer reported.
The company’s IPO will further improve the access of young entrepreneurs to capital, says Bokhari, who describes Charlotte as risk averse for a long time, a place “which looks at things like blockchain with a skeptical eye”.
“It will be a long way. A lot of capital is locked up in this city, ”he says.