You have to hand it to NetSuite. While the markets have been whipsawing all around, the on-demand finance software company backed by Oracle (ORCL) CEO Larry Ellison got its IPO done via a Dutch auction at a price, $26, almost double the stock’s original target.

If NetSuite’s first day’s trading on Thursday is any indication, the company also did incredibly well in the pricing of shares. So far, the share price is up about 25 percent from its $26 open. Which means the auction approach worked well for NetSuite. A bigger pop in price would have meant the underwriters left money on the table. In NetSuite’s case they swept up every last nickel.

That means proceeds of $161 million for the San Mateo, Calif.-based company, and as much as $185 million, should another 930,000 shares get bought and parceled out by the offering’s underwriters, Credit Suisse First Boston (CS) and W.R. Hambrecht.

So, who are the big winners here? Larry Ellison for starters. He owns 61 percent of the company, now with a market cap of around $1.6 billion. NetSuite’s (N) original VCs, New York-based StarVest Capital, have also done well for themselves.

But the IPO investors, those institutions and individuals who participated in the auction may be wondering if perhaps they paid too much. The last thing they, or the underwriters want, is a stock that dips into negative territory on the first few days of trading – that puts a bad taste in the potential investor’s mouth. NetSuite did dip into the red briefly at the open of the New York Stock Exchange on Thursday, but moved into the positive quickly after. So if you are a flipper, you’re going to need to hold on to your shares a bit longer, and hope NetSuite’s business continues to build. NetSuite had a net loss for the first nine months of 2006 of $26.9 million.

Don’t lose hope. Despite not having turned a profit yet, NetSuite is just one of a handful of leading software-as-a-service companies that are turning the traditional enterprise software model on its ear. Salesforce.com (CRM) was the pioneer, but in every category you’re seeing leaders arise that stand to do very well by a business model that offers cost savings, flexibility and scalability that is hard to match by a traditional software approach.

NetSuite is the latest on-demand company to tap the public markets in a tough year for IPOs. This year has seen a handful of on-demand companies such as K12, AthenaHealth, SuccessFactors and others successfully go public. Given the efficient business model, the technology’s disconnect from the housing market meltdown, and its global footprint, you are going to see more.