Veeva (VEEV) began trading on the NYSE on 16 October 2013

Cloud-based software company is geared to life sciences industry

• software firm specializing in the pharmaceutical industry

Shares of Veeva Systems soared Wednesday as the company made its public trading debut, highlighting heightened investor interest in initial public offerings by cloud-based firms.

Veeva VEEV +0.51%   climbed 85.8% to close at $37.16. The Pleasanton, Calif.-based company began trading on the New York Stock Exchange. Veeva priced its IPO at $20 a share, above its revised range of $16 to $18. The company, which is geared to the life sciences market, had initially set a range of $12 to $14.

Founded in 2007, the company offers Web-based applications that help pharmaceutical and biotech companies manage content and customer relations.

Veeva Systems founder and CEO Peter Gassner 

Unlike traditional software vendors, Veeva makes software applications available on a peruser, per-month basis. The company is part of a wave in IT in which businesses access computing power through a network and pay for computing access they need and use, thus avoiding the expense of setting up data centers.

Veeva co-founder and Chief Executive Peter Gassner witnessed the growth of the trend as a veteran of the tech industry, including Salesforce.com (CRM), known as a pioneer of the software-as-a-service model.

Gassner said he also saw opportunity in industry-specific applications and decided to start Veeva with the life-sciences market in mind.

“Some of the most important applications out there are industry-specific applications,” he told MarketWatch. “You can have strong revenue growth and strong profit in a cloud computing company. That’s what’s generating enthusiasm.”

For its fiscal year ended Jan. 31 2013, Veeva posted a net income of about $19 million, on revenue of roughly $130 million, compared with a profit of $4 million, and revenue of $61 million in the year-earlier period.

Another cloud-based company, Textura Corp. (TXTR), which offers Web-based applications to contractors and construction firms, has its stock soar nearly threefold since going public in June with an IPO price of $15.