its filing here), unafraid of what is otherwise a moribund initial public offering market.
The company said it will try to raise $400 million and set its price through an auction.
The underwriters are Goldman Sachs, Merrill Lynch, Credit Suisse, and WR Hambrecht & Co. Google raised its money through an auction, a move that allowed it to raise more money rather than see the proceeds go to first-day investors who flip their stock quickly.
Rackspace revenues grew 62 percent last year to $362 million, the company reported. It profits were $17.8 million, down 10 percent, however. Profits declined because the company expanded staff, sales and marketing. Disclosure: VentureBeat uses Rackspace as its host.
Rackspace had raised more than $30 million over the past decade. It was founded in 1996 by three students at Trinity University: Richard Yoo, Dirk Elmendorf and Patrick Condon. Then, in 1998, Graham Weston and Morris Miller invested seed capital into the company and took over management of the company.
The company won kudos last year when one of its data centers in Texas failed, and in response it offered $3.4 million in credits to customer accounts.
Venture capital forms Norwest and Sequoia will be among the biggest beneficiaries of a successful IPO. Norwest owns 16.2 percent of the company, while Sequoia owns 11.6 percent. Graham Weston, chairman and former CEO, owns 23.9 percent of the company.
TechCrunch caught early word of the IPO filing.