Silicon Valley startup Workday co-founded by PeopleSoft's Aneel Bhusri files for IPO

Workday Inc has filed confidentially for an initial public offering, several sources told Reuters, putting the Silicon Valley business software company on track for the largest market debut since Facebook Inc's problem-ridden May coming-out party chilled demand for US IPO's.

Workday, backed by Amazon.com Inc  Chief Executive Officer Jeff Bezos, filed for an IPO a week ago under a new law known as the "JOBS" Act, which lets companies keep financial details contained in IPO documents private for longer, the sources said.

Workday plans to debut in October, depending on market conditions, several of the sources said. Banks selected to run the offering include Morgan Stanley, Goldman Sachs  and JP Morgan, the sources sai d on condition of anonymity.

Pleasanton, California-based Workday was co-founded by David Duffield and Aneel Bhusri, ex-PeopleSoft executives who left that company after its acquisition by Oracle Corp in 2004. It sells human resources and financial management software.

Many investors have grown disillusioned with high-flying Internet IPOs over the past year, particularly after Facebook shed a third of its value after its May 18 debut.

But corporate software companies - which mostly have more stable, subscription-based business models - remain in demand in an otherwise weak IPO market.

Data analytics software maker Splunk's  shares doubled on their market debut in April and remain more than 50 per cent above their IPO price. Other enterprise software companies that have listed include Guidewire , Jive Software and Demandware, and ServiceNow Inc  which rose 29 per cent during its June 29 start.

Workday filed its S-1 with the Securities and Exchange Commission under the Jumpstart Our Business Startups (JOBS) Act, a recently enacted law that loosens some of the regulations surrounding the IPO process, two of the sources said.

It is intended to help companies with less than $1 billion in revenue go public. Workday's potential buyers will have to wait longer for their first look at its financials, as companies who file under the new framework will not have to reveal such details until 21 days before embarking on an investor roadshow.

JPMorgan, Morgan Stanley and Goldman Sachs declined to comment. A Workday spokesman declined to comment on its "future financing plans."

You're not alone

Workday is not alone among enterprise specialists still seeking capital. Network security provider Palo Alto Networks said on Tuesday it was selling 6.2 million shares at $38 to $40 apiece, raising its range from $34 to $37.

Workday, which also offers software for day-to-day business needs such as accounting, has been grabbing business from companies like Oracle and SAP.

Oracle CEO Larry Ellison recently derided Workday for not using a database and for relying on a Flash interface, saying that renders it useless on an Apple Inc iPhone or iPad. Workday has said it works on both.

While more and more companies opt to stay private for longer, Workday primarily decided to tap public markets because many of its customers are large corporations -- typically more comfortable working with a public company. It also wanted to provide liquidity to employees, one of the sources said.

Workday has raised $250 million from venture capital firms and other investors, including Greylock Partners, New Enterprise Associates, T Rowe Price, Morgan Stanley Investment Management, Janus Capital Group Inc and Bezos Expeditions, the personal investment entity of the Amazon CEO.