This image was lost some time after publication.

The IPO market is unquestionably back. Having tapped the market for financial companies to take public, Wall Street is now turning, yet again, to Silicon Valley for IPO candidates. The latest one: NetSuite, Larry Ellison's pet Web-based software company. NetSuite's premise is simple and appealing: Cheap, Web-based alternatives to software from Oracle and SAP to run small businesses's finances and operations. But NetSuite's S-1 filing, the obligatory prospectus companies must file before they sell shares to the public, is anything but simple and appealing. After the jump, the most disturbing bits, and plain-English translations.

We have not been profitable on a quarterly or annual basis since our formation. We experienced a net loss of $23.4 million for 2006 and $3.7 million for the three months ended March 31, 2007. As of March 31, 2007, our accumulated deficit was $193.0 million. We expect to make significant future expenditures related to the development and expansion of our business. In addition, as a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company.

Translation: Remember when companies like Netscape went public without any profits to report? Without even a timetable for getting to profitability? We're back to those days.

We host our services and serve all of our customers from a single third-party data center facility located in California. We do not control the operation of this facility. This facility is vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, terrorist attacks, power losses, telecommunications failures and similar events. Our data facility is located in an area known for seismic activity, increasing our susceptibility to the risk that an earthquake could significantly harm the operations of this facility.

Translation: We're a Web-based software company, but the physical security of our connection to the Internet is tenuous at best. If our data center goes out, we and our customers are equally hosed.

Our data facility has no obligation to renew its agreement with us on commercially reasonable terms, or at all. If we are unable to renew our agreement with the facility on commercially reasonable terms, we may experience costs or downtime in connection with the transfer to a new data center facility.

Translation: Our data-center operator could decide to rip us off, and since we only have one data center, we'd have absolutely no leverage in the negotiation.

There's more along these lines, if you have the stomach for making it through the entire S-1. Most investors won't bother, of course, which is why, despite NetSuite's flaws as a business, it might actually manage to go public. That's the point of releasing a prospectus, of course: Even if no one pays attention, you can't say you weren't warned.