In the wake of the troubled Facebook public offering, Kayak is finally launching its own IPO into uncertain waters. The move seems especially bold during a period when other Web startups have received less-than-enthusiastic responses from investors, and when Kayak itself has seen competition from newer rivals. Its trajectory is bound to be a bellwether of tech IPOs to come.

 

Kayak said in a filing with the SEC that it will offer 3.5 million shares at a price between $22 and $25 per share. At the high end of that range, Kayak would raise $87.5 million and be worth just below $1 billion.

Since May's Facebook debacle, only two other Internet companies have priced initial public offerings, both of them in the enterprise space. In late June, ServiceNow, an on-demand business-software platform, raised $210 million. (It's trading 44% above its $18 offering price.) And on Monday, Palo Alto Networks filed to raise $220 million to build its business providing firewalls for corporate networks.

Kayak, which employs 185 people, said that revenue in its most recent quarter rose 39% to $73 million and net income totaled $4.1 million, or 11 cents per share. In 2011, the company posted a net profit of $9.7 million on $225 million in revenue. Its biggest expense is marketing, which consumes more than half of revenue.

To show their confidence in the Kayak IPO, several venture financiers are planning to invest more money in the company in a private round concurrent with the IPO. Oak Investment Partners, General Catalyst Partners, Sequoia Capital and Accel Partners, all longtime backers of Kayak, are participating in a 1.2 million-share private placement. Such tactics are common in biotech IPOs, but it's not clear whether the move will assuage concerns among jittery investors in Internet IPOs.

Kayak has delayed its IPO for nearly two years as other Web companies like Zynga, Pandora and most notably Facebook have gone public only to see their shares tank in the following days and weeks. Facebook's IPO was initially seen as the spark that would ignite demand for Web IPOs, but it ended up having the opposite effect.

In the meantime, Kayak's market has grown only more crowded. The company is seeing competition not only from bigger, more established companies like Expedia and Orbitz; it also faces upstarts like Hipmunk, which has grown quickly despite similarities to Kayak.

After languishing so long in the IPO queue, Kayak seems an unlikely candidate to restore confidence in Internet IPOs. If successful, it could help pave the way for more such offerings. If not, it could be remembered as a canary in the coal mine that is the post-Facebook market for tech IPOs.