Mail Stop 4561
September 30, 2005
Richard Rudman
President and Chief Executive Officer
Vocus, Inc.
4296 Forbes Boulevard
Lanham, MD 20706
Re: Vocus, Inc.
Amendment No. 3 to Form S-1
Filed on September 9, 2005
File No. 333-125834
Dear Mr. Rudman:
We have reviewed your responses and have the following
comments.
Summary
1. See prior comment 2. Please expand the disclosure to expressly
state, in connection with your first reference to the $59 billion
budgetary estimate, that such amount does not represent the size
of
the market for your solutions, which you estimate to be at $2
billion.
Management`s Discussion and Analysis
2. See prior comment 6. We note your revised disclosure on page
27
to the effect that price increases have ranged from 5 to 10% since
2003 and your supplemental response that you do not consider price
increases to have been a contributing factor to revenue growth
specifically for the year ended December 31, 2004 or the six
months
ended June 30, 2005. Price increases of 10% appear to be
significant
and should be discussed in the periods in which they occurred.
Moreover, because you experienced material increases in revenues
for
each of the periods presented, a narrative discussion of the
impact
of changes in price versus volume should be provided for each
relevant period. Please tell us why you are unable to make
reasonable assumptions you could disclose that would enable you to
estimate the effect the price changes had on your revenues.
3. We note your response letter describing various limitations on
your ability to quantify the extent to which changes in revenue
are
due to changes in prices or volumes sold. The fact that your
prices
charged vary depending on the subscription terms and that you
offer
discounts and incentives does not preclude you from comparing
prices
from one period to the next. Please revise your MD&A consistent
with
the above.
Business
4. See prior comment 9. We do not consider $4,500 to be a nominal
cost. If you continue to include market estimates attributed to a
third party in your registration statement, obtain a consent from
IDC
and file the consent as an exhibit. See Rule 436(a).
Alternatively,
we will not object if you remove the reference to IDC and revise
the
disclosure to express the statements as Vocus` views, based on its
market research and analysis.
5. We note the added disclosure on page 47 regarding the data
license
agreements filed as exhibits to the registration statement.
Please
disclose in more precise terms here and elsewhere as discussed in
the
prospectus what portion of your acquired third-party content you
replaced with content developed internally in 2005. Also disclose
whether you consider any of these suppliers to be single source
suppliers the loss of whom would substantially affect your
business.
Underwriting
6. We note that the underwriters have reserved shares for sale
directly to employees and other persons designated by you. See
page
68. Supplementally describe the mechanics of how and when these
shares are offered and sold to investors in the directed share
program for this offering. For example, tell us how the
prospective
recipients and number of reserved shares are determined. Tell us
how
and when the issuer and underwriter notified the directed share
investors, including the types of communications used. Discuss
the
procedures these investors must follow in order to purchase the
offered securities, including how and when any communications or
funds are received by the underwriter or the company. How do the
procedures for the directed share program differ from the
procedures
for the general offering to the public?
Vocus, Inc. and Subsidiaries Consolidated Financial Statements
Notes to Consolidated Financial Statements
Note 3. Acquisitions, page F-13
7. We note your reference to a third-party valuation used to
estimate
the fair value of your common stock in the Gnossos acquisition.
In
addition, we note the reference on page 29 to third-party
valuations
used to estimate the fair value of your common stock. Tell us
what
consideration you gave to identifying the valuation specialist and
including the expert`s consent pursuant to Section 436(b) of
Regulation C.
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. We may have
additional comments based on reviewing your amendment and
responses
to our comments.
You may contact Morgan Youngwood at 202-551-3479 or Melissa
Walsh at 202-551-3224, if you have questions regarding comments on
the financial statements and related matters. Please address all
other comments to Maryse Mills-Apenteng at 202-551-3457. If you
require further assistance you may contact the undersigned at 202-
551-3462. If you still require further assistance, please contact
Barbara C. Jacobs, Assistant Director, at 202-551-3730.
Sincerely,
Mark P. Shuman
Branch Chief - Legal
cc: Stephen A. Riddick, Esq.
Greenberg Traurig, LLP
800 Connecticut Avenue, N.S. Suite 500
Washington, D.C. 20006
??
??
??
??
Richard Rudman
Vocus, Inc.
September 30, 2005
Page 2