MFA: Most Valuable Player on the IPO Team

Ken Goldman didn’t have time to listen to excuses. It was October 2006, and the senior vice president and chief financial officer of Salary.com – which builds on-demand compensation management software for businesses of all sizes – was bringing the company public. He knew the importance of timing to an IPO, and he also knew that exacting SEC requirements could slow down even the most prepared filing.

“The stock market for on-demand software companies was strong at the time,” recalls Goldman. “It was essential that we capitalize on that in order to best serve our stakeholders. That meant getting through the process quickly, smoothly, and in full compliance with the SEC.” Excessive delays, he knew, could be devastating.

To help with the demanding IPO process, Goldman turned to MFA to conduct critical valuations of the company’s common stock, restricted stock, and stock options. “Because our stockbased compensation included specialized options with unique accounting requirements, the entire project was extremely complex and required deeply knowledgeable professionals,” Goldman says. In addition to their work on stock-based compensation, MFA also valued intangible assets for a Salary.com acquisition, and helped with a number of complex accounting issues such as the early adoption of FAS 123R.

“MFA very quickly became the deal team’s MVP,” says Goldman. “The firm’s execution and expertise was outstanding in every instance, as was their timeliness. The IPO deal team – which included five investment banks, two major Boston law firms, and two additional CPA firms – was very impressed with MFA’s technical prowess.”

The Salary.com S-1 filing went smoothly. “Clearing the comments we got back from the SEC didn’t cause major delays, and the entire process was expedited, given the outstanding work that MFA did on the valuations,” Goldman says. “Most people make promises and then come up with excuses why they can’t fulfill those promises. But MFA delivered on every front and on time.”

The stock market was doing well on February 15, 2007, when Salary.com completed its IPO. “We had originally filed our S-1 with a pricing range of between $8 and $10 a share, and expected to sell 5 million shares,” says Goldman. “Given our fortuitous timing and a strong performing stock market, we achieved pricing of $10.50 per share, and sold 5.7 million shares.”
Goldman’s leadership and MFA’s fast, accurate contributions had secured Salary.com’s successful entrance to the public domain.

Today MFA’s relationship with Salary.com has expanded to tax accounting and consulting, Sarbanes-Oxley consulting, and quarterly 10-K and 10-Q filings. “The skill and knowledge levels of the MFA team rival any firm in the world,” Goldman says. “I strongly recommend that any company going through an IPO or other complex transaction consider engaging MFA.”

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