24/7 Wall St.

Enterprise software developer Appian Corp. (NASDAQ: APPN) sold 6.25 million shares in its initial public offering (IPO) on Thursday, raising $75 million. The shares rose as much as 36% before closing their first trading session at $15.01, a gain of 25% over the IPO price of $12 per share.

Appian calls its product a “low-code software development platform as a service” that customers can use to develop applications more quickly. The “low-code” descriptor means that little customer coding is required in order to create custom applications.

In its filing with the U.S. Securities and Exchange Commission (SEC), Appian elaborates:

We believe that developing applications on our platform can be as simple as drawing a picture. Our platform automates the creation of forms, data flows, records, reports and other software elements that would otherwise need to be manually coded or configured. This functionality greatly reduces the iterative development process, allowing for real-time application optimization and ultimately shortening the time from idea to deployment.

Underwriters for the offering included Morgan Stanley, Goldman Sachs, Barclays, Pacific Crest, Canaccord Genuity and Cowen. The underwriters have an overallotment option on an additional 937,500 shares.

If the underwriters exercise that option, the publicly traded Class A shares will amount to about 12.2% of shares outstanding. Class A shares are entitled to one vote per share. Class B shares, of which 52.4 million are outstanding and another 7.1 million are options, are entitled to 10 votes per share.

Appian’s services revenue in 2016 was more than double its subscription revenue, but over time the idea is to reduce the amount of development the company does and increase the number of subscriptions.

Over time, as the need for professional services associated with user deployments decreases and the number of end users increases, they expect the mix of total revenue to shift more toward subscription revenue.

The company plans to use about $20 million of the net proceeds from the IPO to repay an outstanding term loan in full. Another $7.4 million will be paid as a cash dividend to the holders of Appian’s Series A preferred stock upon the conversion of the Series A preferred stock to Class B common stock, which occurred immediately prior to the closing the IPO.

Shares traded up about 4% at $15.61 in early Friday. Thursday’s high was high was $16.75.