By Krystal Hu and Echo Wang

(Reuters) -Shares of Amplitude Inc opened nearly 43% above their reference price in their Nasdaq debut on Tuesday, notching up a valuation of about $5 billion for the benchmark-backed analytics company.

Amplitude in San Francisco, which filed confidentially for direct listing in July and raised $150 million from Sequoia Capital, Singapore’s sovereign wealth funds GIC, in June. The company was valued at $4Billion.

The stock of the company was opened at $50 per shares, an increase from $35 per share.

Amplitude offers data analytics tools to help companies optimize their products. Peloton Interactive (NASDAQ 🙂 Inc, NBCUniversal and Instacart are some of its customers.

As companies strive to make customers experience better online, they have benefited greatly from digital transformation’s rapid pace during the epidemic.

The company reported $72million in revenues for the first half, an increase of 56% year-over-year, as opposed to a $16.5 million loss.

The seven-year-old company chose to go public through a direct listing, an alternative to an initial public offering that has gain traction among companies after Spotify Technology SA (NYSE:) pioneered it in 2018.

A direct listing permits companies to go public on the stock markets without selling shares. A reference price is set by the company, and no shares will be sold prior to that price. An IPO sells shares at a predetermined price.

Direct listing is a preferred option for Amplitude Cofounder and CEO Spenser Skates. Companies have a wonderful window to get out in this year. We can do this as quickly as possible.

Amplitude’s impressive debut is seen by investors as a way to encourage other tech companies that are looking for ways to become public.

Direct listings are at an historic moment. The market looks at Amplitude because it appears like many software companies will become public within the next 12-18 months. This is because of its size and growth. It also doesn’t seem to be well-known names. Neeraj, a partner in Battery Ventures who was an early investor, stated that Amplitude has been a watershed moment for direct listings.

Morgan Stanley (NYSE:) advised Amplitude on the direct listing.