Rosetta Stone Goes Public – Files for $115 Million Dollar IPO

Earlier this week, Rosetta Stone, the language tutorial company, decided to go public via an initial public offering. It’s applied to take the stock ticker “RST” on the New York Stock Exchange.

Rosetta Stone is a great company, I actually use the Spanish language version and it’s mind-blowingly comprehensive. It has everything you could imagine a language learning software could have. Plus the financials are stellar. Revenue has grown from $15.5 million in 2003 to $137.3 million in 2007. In the first half of this year alone it’s inched 39% higher. It has the mind-share in the industry, Michael Phelps was talking about using it to learn Mandarin for the Olympics, and we’re in a growing world market with Spanish speakers increasing in the US and Mandarin and German becoming important business langauges. It’s just a quality company with phenomenal potential. It’s actually one of those private companies I wished would go public, along with Cold Stone Creamery and Wawa Food Markets… but I wouldn’t buy a single share in that company just yet.

The market is not treating IPOs well right now. There is a near panic type of mindset out there with investors. Look at Rackspace (RAX) or last years darling NetSuite (N): they’re both trading below their IPO prices at the moment. I say give Rosetta some time to settle into the market, watch and wait, but keep it in your sights. This is definitely a great company with a lot of potential, I’m just a little leery of jumping on the IPO bandwagon right out of the gate.