By Biz Carson and Michelle Ma,
After a record year for tech IPOs, it’s a wonder that there are any tech companies still left waiting in the wings. Over 400 companies went public in 2021, the busiest year since 2000, according to Renaissance Capital. But that doesn’t mean every worthy tech company went out the door. Between corporate spin-outs, pushed-off plans and already confidentially filed prospectuses, there’s a strong lineup ahead for 2022. Plus, more than a few investors are hoping that longtime private companies like Stripe finally make it to the IPO altar.
Here are the IPOs on the horizon in 2022 — and how likely they are to happen.
The social media company confidentially submitted a draft registration with the SEC in December. The momentum is clear: While Reddit users turned Wall Street topsy-turvy by trading up meme stocks, Reddit the company rode the attention to ever-higher private valuations in two rounds of funding in February and August. CEO Steve Huffman has said he plans on investing to expand to new markets and make product enhancements, like better video capabilities, to compete with TikTok.
What it does: Reddit is the home of infamous communities like the subreddit r/WallStreetBets, which popularized hard-to-love stocks like AMC and GameStop.
Financials: The company was valued at roughly $3 billion by private investors before the meme-stock squeeze in January. After its latest funding round, Reddit said in August that it was worth more than $10 billion.
The names you should know: Huffman, who quit the company in 2009 but returned as CEO in 2015, has said he wants Reddit users to be shareholders once the company goes public. And while co-founder Alexis Ohanian is still very much associated with the brand, he quit his board seat in 2020. There’s also CTO Chris Slowe, who was Reddit’s first employee, left in 2010 and later rejoined the company.
What to look for: The company is looking into ways to make the IPO more accessible to individual investors, Huffman said in October, pointing to the rise of apps like Robinhood in democratizing the stock market for retail investors like the ones who drove r/WallStreetBets.
Mobileye is planning to return to the public markets sometime mid-2022 after Intel announced in December that it planned to take its self-driving car-tech unit public as a separate company. Mobileye had previously gone public in 2014 before it was acquired by Intel in 2017. Intel says it will retain majority ownership in the separate, publicly traded company.
What it does: The autonomous driving unit builds safety systems for auto manufacturers, and aspires to soon launch its own robo-taxi business in Germany.
Financials: Intel acquired Mobileye for $15 billion in 2017. It’s now projected to grow revenue by 40% in 2021.
The names you should know: Amnon Shashua will remain CEO of Mobileye, the company he started in 1999. After Intel acquired Moovit and made it part of Mobileye in May 2020, Moovit CEO and co-founder Nir Erez joined the executive team and currently plays an important role in Mobileye’s future plans.
What to look for: Plenty of AV companies have gone public in the last two years, but the vast majority did it with a SPAC. There have been accusations of the industry over-promising and under-delivering, but Mobileye’s experience as a publicly traded company could be an advantage.
The mobility company has filed a confidential draft registration with the SEC, it announced in December, following the trend of other technology-driven transportation companies like Xos, Rivian and charging company EVgo.
What it does: The New York-based company is focused on public mobility systems like buses, shuttles and wheelchair-accessible vehicles, as well as autonomous and electric vehicles. It has over 500 partners today, including the LA Metro, Jersey City and Miami.
Financials: The company reached a $3.3 billion valuation in November, following a $130 million Series G round which brought its total funding to $777 million. Sales of Via’s software, TransitTech, doubled year over year, reaching an annual run rate of $100 million, according to TechCrunch. Via also acquired collaborative mapping platform Remix in 2021 for $100 million, as well as delivery logistics startup Fleetonomy in 2020 for an undisclosed amount.
The names you should know: Via was founded in 2012 by Israeli entrepreneurs Oren Shoval and Daniel Ramot, the company’s CTO and CEO respectively, both of whom had previously worked for the Israeli Air Force developing avionic systems for fighter jets.
What to look for: Via isn’t the only mobility startup that has its eyes on a 2022 IPO. Other potentials include scooter company Voi Technology, which recently raised a $115 million Series D round, as well as Kakao Mobility, which raised an additional $55 million, bringing its valuation over $4.2 billion.
Rumored 2022 contenders
The question-and-answer website has started holding talks to hire investment bankers and lawyers for an IPO, according to anonymous sources who spoke to Reuters in November. The company said it doesn’t “comment on rumors” when asked about the potential IPO, but has had a significant rise in job listings since October, signaling an expansion. It laid off an undisclosed number of staff in January 2020.
What it does: Quora started off as a home for crowdsourced questions and answers, and has since expanded to include blogging. According to the company, over 300 million people use the site every month.
Financials: The Mountain View-based company was last valued at around $2 billion since a private funding round in 2019, and Reuters’ source said it hopes to be worth double that in an IPO.
The names you should know: Founded in 2009 by former Facebook CTO Adam D’Angelo and Charlie Cheever, Quora is still headed by D’Angelo. Cheever stepped down in 2012.
What to look for: The service is trying to make itself more attractive to creators and move beyond Q&As. D’Angelo said in August that it’s “on track to be cash-flow positive from ads alone,” but that it’s looking to branch into subscription revenue as well, introducing Quora+, which allows creators to put content behind a paywall: Quora would take 5% of the subscription fee.
The digital-banking service is targeting March 2022 for an IPO, with a valuation of $35 to $45 billion, according to an anonymous source who spoke to Forbes in October. The company has yet to comment. That valuation would make it more valuable than regional banks like Fifth Third, M&T and Regions, according to Forbes.
What it does: Chime is an online banking service that offers checking accounts sans monthly or overdraft fees. The neobank also doesn’t require a minimum balance, and markets itself as a consumer-friendly banking alternative. It got in trouble with California for calling itself a “bank” — technically, it just provides a front end to accounts held at Bancorp Bank and Stride Bank.
Financials: Annual revenue for the company will likely reach $900 million to $1 billion, according to Forbes’ source. The company hasn’t been consistently profitable, but CEO and co-founder Chris Britt said that it turned a net profit in the second quarter of 2020. Protocol last reported in August that the company raised $750 million in funding at a $25 billion valuation.
The names you should know: Britt co-founded Chime with CTO Ryan King. Board members include Cynthia Marshall, CEO of the Dallas Mavericks, and Sue Decker, the former Yahoo president and current board member of Berkshire Hathaway.
What to look for: ProPublica reported in July that the company has seen more than 900 complaints filed with the Consumer Financial Protection Bureau since April 2020, with many of them from users saying they can’t access their cash.
Originally a 2021 IPO contender, Instacart pushed off its IPO plans until mid-2022 as it faced an executive shake-up and increased competition from delivery rivals, The Information reported.
What it does: The nearly 10-year-old startup became a pandemic staple for its grocery delivery business. It’s expanded to more retailers beyond food, including brands like the Container Store, Dollar Tree and Michael’s.
Financials: The company is expected to record revenue increasing to $1.65 billion for 2021, up 10% from 2020, according to the Information. It was last valued at $39 billion after raising $265 million in March.
The names you should know: Former Facebook exec Fidji Simo took over the CEO role last year from founder Apoorva Mehta. She recruited Facebook’s former ad chief Carolyn Everson to join as president, but Everson left after three months.
What to look for: The company has been synonymous with grocery delivery, but now other delivery services, from Uber to DoorDash, are making deeper inroads on delivery outside of dinner.
Rappi co-founder Juan Pablo Ortega told reporters to expect a listing for the Colombian delivery company sometime in the second half of 2022, but his creation pushed back, saying that it had not taken any actions toward an IPO. “Mr. Ortega’s declarations are personal feelings that do not represent our company goals,” Rappi said at the time. If it did go public in 2022, it’d likely be one of the highest-profile Latin America IPOs in the U.S. (Rappi’s CEO has not yet responded to a request for comment.)
What it does: The Bogotá-based delivery company wants to become “the everything store” for Latin America. It graduated from YC’s winter 2016 batch and has gone on to attract funding from firms like SoftBank, Andreessen Horowitz and Sequoia.
Financials: In July, Rappi said it had raised over $500 million at a $5.25 billion valuation in a round led by T. Rowe Price.
The names you should know: The company’s co-founders include CEO Simón Borrero, Sebastian Mejia and Felipe Villamarin.
What to look for: Rappi had to lay off employees at the start of 2020, but as the pandemic has shown the world, delivery is more essential than ever, and so far investors have an appetite for companies in the space.
When Walmart took a majority stake in Indian ecommerce business Flipkart in 2018, it was seen as a huge vindication for India’s fast-growing tech sector. “The [Flipkart] business is performing almost exactly like we thought it would. An IPO is still very much on the cards for that business,” said Walmart CFO Brett Biggs at a conference in December. Flipkart is reportedly eyeing a $50 billion valuation through a stock listing this year, which would make it India’s biggest consumer tech IPO.
What it does: Founded in 2007, the Indian ecommerce business has more than 350 million registered users and is also the majority owner of PhonePe, a payment app that reportedly also has more than 300 million users. The company competes with Amazon in India, and aims to push a country still dominated by physical stores towards online retail.
Financials: Walmart purchased a 77% stake in the company for $16 billion in 2018. In July, the company’s latest $3.6 billion fundraising pushed its value to nearly $38 billion, by far the largest of any Indian startup.
The names you should know: Kalyan Krishnamurthy has been CEO of Flipkart since 2017, though his involvement goes back years before that, including a stint as acting CFO in 2013. Before Flipkart he was a managing director at Tiger Global Management, in charge of the fund’s India portfolio.
What to look for: Biggs said of a potential IPO that it depends on timing: “Is the business exactly where you want? Is the market right? All those things [you] have to figure into [when] you do an IPO.”
The scooter company faced a “near-death experience” during the pandemic, but has been on the rebound since. After raising over $523 million in debt financing in November, Lime CEO Wayne Ting saw it as a sign of investor interest in micro-mobility startups and told TechCrunch it was “a real great milestone as we look towards taking Lime public” this year. The same day Lime announced its funding, the scooter company’s rival Bird went public in a SPAC that valued it at $2.3 billion. In December, Ting told CNBC that they’re “ready today” and “certainly going to be taking a look at it closely” in 2022.
What it does: Founded in 2017, Lime has been at the forefront of the micro-mobility wars, offering bike, scooter and electric moped rentals across the globe.
Financials: Lime has been “adjusted EBITDA-profitable” for two quarters, which is startup-speak for not really profitable but in a better financial position than it used to be.
The names you should know: Lime was started by Toby Sun and Brad Bao, both of whom have served as CEO. In 2020, former Uber exec Ting took over the CEO role from Bao after serving as the company’s head of Global Operations.
What to look for: SPAC talks reportedly fell through once, and Bird’s de-SPAC deal hasn’t exactly shown that the markets are crazy for micro-mobility companies right now. After losing most of its revenue in the pandemic, Lime is still rebuilding.
You wish (and so does everybody)
There are companies that have given clear signs of intent to go public. And then there are the companies everyone wishes would just IPO already.
EquityBee’s list of the most sought-after startups to go public included perennial favorites like Stripe and SpaceX, two massive but still private companies. Impossible Foods is another fan-favorite to go public, a move that the CEO has acknowledged is “inevitable” but “not even close.” Databricks is another one that was considered a strong IPO contender for 2021 before it raised a fresh $1.6 billion in August. Meanwhile, Klarna’s CEO admitted that the market’s volatility makes him “nervous” about the prospect of an IPO for the fast-growing “buy now, pay later” company.
Given that, 2022 will have a hard time topping 2021’s abundance of IPOs, but a few big deals like a SpaceX or Stripe offering could do the trick.
Source : https://www.protocol.com/tech-ipos-2022