Instacart IPO Is an Expensive Lesson for Venture Firms
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Grocery-delivery app Instacart hopes to capitalize on what its chief executive calls a “massive digital transformation” in the way people shop at supermarkets, but it faces steep competition and an uncertain demand environment.
The company filed for an initial public offering late last month, and its debut could hit markets even as customers are still struggling with higher grocery prices. Meanwhile, big rivals like Walmart Inc.
WMT,
Amazon.com Inc.
AMZN,
Uber Technologies Inc.
UBER,
and DoorDash Inc.
DASH,
are competing more aggressively for a bigger slice of the online grocery-buying market, whether it’s for big weekly shopping trips or smaller runs for a handful of items.
Instacart, which would trade under the ticker CART, already controls around 22% of the $132 billion U.S. online grocery-delivery market, according to Evercore analysts. The company is banking on a bigger online future for purchases of household essentials, one that over the decades could include more mobile checkout, electronic shelf tags and what Instacart describes as “AI-powered smart carts.”
A stock-market debut for Instacart, which was founded in 2012, would come after the company last year reportedly shelved its plans to go public after decades-high inflation, recession fears and a postpandemic tech-industry slump soured investor appetites for IPOs. Last year, Instacart cut its valuation multiple times, but the company raised it this year to around $12 billion, according to the Information.
Some investors said the delay might be a good thing.
“I think they’re hitting the public markets as a more mature company that’s gone through the cost-cutting and the business-model transition behind closed doors, instead of having it play out on quarterly conference calls,” said Don Short, head of venture equity at InvestX, whose portfolio includes Instacart.
The company is planning to offer 22 million shares priced at $28 to $30 each, after raising that price range on Friday in the wake of the successful IPO Thursday of chip company Arm Holdings PLC.
ARM,
Arm closed up 25% on its first day of trading. Instacart would raise $660 million at the top of that range.
With 276.5 million shares expected to be outstanding once the deal closes, Instacart would have a valuation of $8.3 billion.
Here are five things to know about Instacart’s planned IPO.
1. It has sales growth and some profit …
During the first six months of this year, Instacart had $1.475 billion in sales, a 31% jump over the first half of last year. It closed out last year with revenue of $2.55 billion. The company finished last year with a $428 million profit, which included a hefty tax benefit, and it had net income of $242 million for the first half of this year.
Bernstein analysts, in a recent note, said the company was “more profitable than expected,” pointing to steady gross-margin expansion over the past few years. That expansion has been helped by momentum for Instacart’s advertisement business, which lets brands run sponsored ads and other promotions on Instacart. Margins also benefited from retailer and customer fees for order handling, which translated to $16 per order in 2022.
Instacart said that in 2022, the average value for a grocery order stood at $110, the Bernstein analysts noted. That year, Instacart made around $7 on average in gross profit per order.
“Overall, cohort engagement looks sticky post-Covid,” the analysts said. But they said they wondered how big the company could become, noting that 7.7 million monthly customers “isn’t a lot” and could either represent a “growth opportunity or tapping out of an audience.”
2. … but higher grocery prices have weighed on orders
Through the first six months of this year, total customer orders on Instacart stood at 132.9 million, up only slightly from the 132.3 million orders logged during the first half of last year. Instacart, in the filing, noted that higher grocery prices have weighed on demand. UBS analysts noted that customers have been ordering cheaper fare.
Short said that slower growth wasn’t surprising in light of gains made during the pandemic. And Instacart also pointed to seasonal factors that can affect demand, saying that fewer customers order on the platform during the spring and summer, with trends rebounding as the back-to-school and holiday seasons pick up.
The UBS analysts said they viewed those trends as “cautious read-throughs” for the grocery-delivery ambitions of Uber
UBER,
and DoorDash
DASH,
3. The company wants to make more money from ads, but advertisers are cautious
Like DoorDash and retailers such as Amazon.com and Walmart, Instacart hopes to use more of its digital space to allow brands to advertise. That business, for which advertisers pay fees, is growing. Instacart’s “advertising and other revenue” hit $406 million during the first half of this year — up 24% from a year ago. And digital ads elsewhere have brought fatter margins, which could help offset the costs of running a delivery network.
But Instacart noted the impact from more cautious advertiser spending amid concerns about the economy, saying “our advertising performance was impacted by changes in spend by certain brand partners due to macroeconomic uncertainty and changes in our brand partners’ businesses and performance.”
4. Its customers are big grocery chains — but its top 3 customers make up a large chunk of its sales
Instacart has partnerships with more than 1,400 retail names, including chains like Costco Wholesale Corp.
COST,
and Kroger Inc.
KR,
which wants to merge with Albertsons Cos
ACI,
Instacart, citing data from Euromonitor, noted that the top 20 grocers are responsible for more than two-thirds of the U.S. grocery market. And the grocery platform gets around 43% of its gross transaction volume — a gauge of the value of products sold — from its top three retailers.
“If any of these retailers were to suspend, limit or cease their operations or otherwise terminate their relationships with us, the attractiveness of Instacart to consumers and brands could be materially and adversely affected,” Instacart said in its IPO filing.
5. It has backing from Pepsi
In the filing, Instacart said it had entered into an agreement with PepsiCo Inc.
PEP,
under which Pepsi will buy $175 million of Instacart’s Series A redeemable convertible preferred stock in a private placement. The Series A preferred stock will have a conversion price equal to the IPO price and can be converted “under certain circumstances.”
Arm has concluded its debut on the Nasdaq after launching an IPO where shares closed nearly 25% higher on the day.
SoftBank Group’s chip design company, Arm Holdings spiked nearly 25% on its initial public offering (IPO) debut after shares sold for $51.
The company began trading at a valuation nearing $60 billion, under the “ARM” ticker. Arm sold 95.5 million shares, initially trading at $56.10, and closing at $63.59. According to Marketwatch data, Arm is at $65.61 in after-hours trading, climbing more than 3% from its close.
Speaking to CNBC, Arm’s Chief Financial Officer Jason Child said the company sold shares worth $735 million to several strategic investors. These include heavyweights like Nvidia Corp, AMD, Samsung, Intel Corp, Google, Apple, Taiwan Semiconductor Manufacturing Company (TSMC), Synopsis, and Cadence. According to Child, Arm deliberately ensured to keep its sales to a “diverse set of shareholders” even though “there was interest to buy more than what was indicated”.
Child also said that Arm wants to grow its royalties by providing essential products to customers. Most of the company’s royalties come from releases that are more than a few decades old. In 2022, Arm’s revenue from royalties was $1.68 billion. About 50% of this figure were royalties from products launched between 1990 and 2012.
Speaking on the royalties, Child said:
“As a CFO, it’s one of the better business models I’ve seen. I joke sometimes that those older products are like the Beatles catalog, they just keep delivering royalties. Some of those products are three decades old.”
Arm IPO Debut Contributes to $250B Chip Design Market Forecast by 2025
Arm announced the $51 price before trading on the Nasdaq began, adding that underwriters have the option to buy an additional 7 million shares to account for over-allotment. Although Arm has debuted publicly, SoftBank Group retains majority control of the chip designer, at about 90%.
Arm told investors that its forecast for the chip design market by 2025 is $250 billion.
The Nasdaq IPO is the second time Arm is going public since being founded in 1990. The company was acquired by SoftBank in 2016 in a deal worth $32 billion. Before then, Arm had listings in London and New York.
Arm has almost always focused on hardware for mobile phones and has its tech in most mobile phones used today. In addition, Arm sold blueprints for microprocessor designs, as well as licensing instructions necessary for software to ensure compatibility with the chips. Although that part of its business is still active, CEO Rene Haas has been trying to diversify. Following his appointment last year, the CEO is now focused on expansion, pushing the company into advanced computing and designing chips for artificial intelligence (AI) data centers.
Arm is already using its processors to lift AI workloads, especially in smartphones. The company’s processors already help with image filtering and voice recognition on many devices. However, it might take a while for Arm to reap the financial benefits of these AI offerings.
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As a publicly traded company, Instacart will need to navigate fierce competitions.
Instacart, the popular on-demand grocery delivery and pickup service has submitted an updated filing for its upcoming Initial Public Offering (IPO), revealing its ambition to raise up to $616 million in fresh capital alongside existing shareholders.
Instacart IPO: Pricing Strategy
In its updated filing, Instacart disclosed its intention to set an offer price for its IPO within the range of $26 to $28 per share. This pricing range is significant, as it not only values the company but also impacts the funds it can raise. If the IPO is priced at the upper end of this scale, Instacart could secure approximately $616 million in proceeds.
To achieve this fundraising goal, Instacart plans to issue a total of 22 million shares. This includes 14.1 million newly issued shares from the company itself and an additional 7.9 million shares being sold by existing stockholders.
The decision to include shares from selling stockholders underscores their confidence in the company’s potential and a desire to capitalize on the IPO. Instacart’s IPO comes at a time when the online grocery delivery market is experiencing unprecedented growth.
The company has established itself as one of the largest players in the US online grocery delivery sector, with a platform that connects consumers with personal shoppers for a seamless shopping experience.
As the COVID-19 pandemic accelerated the shift towards online shopping, Instacart experienced surging demand and secured partnerships with major retailers, further solidifying its position in the market. In the third quarter of 2022, Instarcart’s revenue grew more than 40% year-over-year, while net income and adjusted EBITDA more than doubled from Q2.
Instacart Faces Stiff Competition
Despite its remarkable growth, Instacart is not without formidable competition. Traditional retailers like Walmart Inc (NYSE: WMT) and Kroger Co (NYSE: KR) have bolstered their own online grocery delivery services, while tech giants such as Amazon.com Inc (NASDAQ: AMZN), DoorDash Inc (NYSE: DASH), GoPuff, and Grubhub Inc have also joined the race.
Meanwhile, Instacart’s decision to go public coincides with another high-profile IPO from British chip design firm Arm Holding Ltd. The company is eyeing a valuation of up to $54.5 billion, signaling its confidence in its technological prowess and future growth prospects.
As a publicly traded company, Instacart will need to navigate these fierce competitions while continuing to innovate and expand its services to maintain its competitive edge.
The IPO market has been relatively quiet in recent times, primarily due to concerns about higher interest rates and rising inflation. However, these upcoming IPOs, along with several others in the pipeline, are set to test the waters and gauge investor sentiment. The success or failure of these IPOs will depend heavily on market conditions at the time of listing.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
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Apple CEO Tim Cook at a 2022 Apple event in Cupertino, Calif.
Justin Sullivan/Getty Images
Brace yourself. This coming week, the tech sector is headed for a Grade A harmonic convergence, with three major pieces of news aligning in a way that could shift the dynamics of the technology sector in dramatic and unanticipated ways.
Within the span of a few days,
Apple
will launch an updated iPhone; the Department of Justice will finally bring its three-year-old antitrust case against Google to trial; and the U.K.-based chip design firm Arm Holdings will likely go public.
Each event carries potential payoffs for investors, along with big risks.
Just Another Phone: On Tuesday, Apple (ticker: AAPL) will hold its annual fall launch event, dubbed “Wonderlust” this year. The event will almost certainly be focused on the debut of the iPhone 15. (Analysts also expect new Apple Watches and potentially updated AirPods.) No one expects a major iPhone overhaul—the most notable change is likely to be a shift from Apple’s proprietary Lightning connectors to the more widely used USB-C standard. There will be updated processors, improved cameras, a thinner bezel, and a few other tweaks. Prices are expected to ratchet up from iPhone 14 levels. Bulls anticipate a boost to iPhone sales from customers replacing older phones—Wedbush analyst Dan Ives estimates that a quarter of the 1.2 billion iPhone install base is at least four years old.
But there are reasons to worry. Consumer spending is far from robust, and mobile phone sales have been softening for many months. According to Counterpoint Research, global smartphone shipments were down 9% in the June quarter from a year ago. Meanwhile, Apple faces double-trouble in China, where the new Huawei Mate 60 Pro smartphone appears to be taking share from Apple. Worse, The Wall Street Journal reported last week that China has banned the use of iPhones and other foreign-branded phones by government officials.
Morgan Stanley analyst Erik Woodring argues that the 6% slide in Apple shares on China fears is overdone. But he notes that the market’s worries go beyond the fate of the iPhone 15.
Woodring writes that “China could potentially be on the path to becoming more nationalistic, a move that would put over $30 billion of operating profit at risk, should China decide to limit Apple’s access to the Chinese market.” He sees that grim outcome as unlikely, given Apple’s large role in China’s economy. Tuesday’s launch won’t settle anything, but it will be followed by an acute focus on the pace of sales in the early going.
Arm’s Race:
SoftBank Group
(SFTBY) bought the chip design firm Arm Holdings in 2016 for $32 billion. In 2021, SoftBank agreed to sell Arm to
Nvidia
(NVDA) for $40 billion in cash and stock, before the deal collapsed under scrutiny from regulators. SoftBank immediately began making plans for an initial public offering. This past week, Arm set a price range of $47 to $52 a share for the pending deal, which implies a valuation of about $50 billion. The IPO is expected to price Wednesday night, with Arm trading on the Nasdaq starting Thursday.
SoftBank’s valuation hopes are ambitious. Arm’s revenue was flat last year, at $2.7 billion. The top of the price range implies a valuation of nearly 20 times trailing revenue, higher than almost any other technology company. Arm is reaching for a value about in line with artificial-intelligence giant Nvidia, but without the growth. It’s a stretch.
And there’s a wild card: the outsize role that China plays in Arm’s fate. Arm is even more reliant on China than Apple, accounting for 25% of its revenue. China-related risks take up three full pages in the Arm IPO prospectus.
No question, Arm is a crucial player in the global chip market—almost every smartphone uses an Arm-designed chip. There’s a long list of tech companies—including Apple, Google, Intel, Nvidia,
Samsung
,
and
Taiwan Semiconductor
—interested in buying IPO shares, according to the Arm prospectus. But Arm’s China exposure could unnerve investors. The bigger risk is that a weak showing for the IPO could block other tech companies from going public this year.
Searching for Justice: Three years ago, the Justice Department sued Google, arguing that the
Alphabet
(GOOGL) unit has an illegal monopoly in the internet search market. That case goes to trial in federal court in Washington, D.C., on Tuesday. In its 2020 complaint, the government said Google has used “anticompetitive tactics” to maintain and extend its near-monopoly position in internet search and search advertising. Google has called the lawsuit “deeply flawed.”
One key issue at the trial will likely be Google’s long-running position as a search provider to Apple for the iPhone and its Safari browser. Any attempt to untangle the connection could be a boon to
Microsoft
,
which operates the Bing search engine. How ironic is that?
Another possibility is the court mandating an end to the exclusive relationship between Apple and Google, spurring Apple to develop its own search engine. Now, that would be a big story indeed.
Write to Eric J. Savitz at eric.savitz@barrons.com
The tech industry was abuzz in 2020 when Nvidia announced its ambitious plan to acquire Arm Holdings from SoftBank for a staggering $40 billion before its planned IPO.
British semiconductor and software design company Arm Holdings plc recently revealed that multiple technology giants, including Apple Inc (NASDAQ: AAPL), Alphabet Inc (NASDAQ: GOOGL), and Nvidia Corp (NASDAQ: NVDA), are interested in purchasing up to $735 million in its shares as it eyes an Initial Public Offering (IPO).
Tech Giants Show Massive Interest in Arm Holdings IPO
While these investments are not certain, their mere consideration highlights Arm’s enormous position in changing the technology world, with its designs powering processors in data center servers, consumer devices, and industrial products.
The impending IPO of Arm Holdings is attracting more attention and intrigue than ever before. Along with Apple, Google’s Alphabet, and Nvidia, a host of semiconductor industry leaders and innovative firms have also expressed an eagerness to invest in Arm.
Notably, Intel Corp (NASDAQ: INTC), Samsung Electronics Co Ltd (KRX: 005930), and Taiwan Semiconductor Manufacturing Co Ltd (TPE: 2330) have joined the race, along with Advanced Micro Devices Inc (NASDAQ: AMD), MediaTek Inc (TPE: 2454), Cadence Design Systems Inc (NASDAQ: CDNS), and Synopsys Inc (NASDAQ: SNPS).
As a result, Arm’s IPO, if successful, could lead to a market capitalization of $52 billion and inject nearly $5 billion in fresh capital into the company. This diversified group of investors emphasizes Arm’s critical role in the semiconductor and technology ecosystem.
Meanwhile, the tech IPO landscape has experienced a noticeable slowdown over the past two years, primarily due to the impact of rising interest rates, which has made investors more cautious about betting on high-growth, high-risk companies.
However, Arm stands out as an exception. Its unique trajectory, from its proposed IPO in London and New York to its acquisition sets it apart from the typical tech IPO narrative.
Nvidia Corp’s Unwavering Backing in Arm
The tech industry was abuzz in 2020 when Nvidia announced its ambitious plan to acquire Arm Holdings from SoftBank for a staggering $40 billion before its planned IPO. However, regulatory hurdles in both the United States and the United Kingdom led to the abandonment of this acquisition in 2022.
Yet, Nvidia’s interest in Arm remains unwavering, and it is evident that the two companies continue to see a promising future together, even if it’s not in the form of a direct merger. Nvidia’s co-founder and CEO, Jensen Huang, has been an enthusiastic advocate for Arm during Arm’s current IPO roadshow.
In a prerecorded video presentation, Huang lavishly praised Arm. He referred to Arm as an “extraordinary company” and highlighted the platform’s value, franchise, and world-class management team. His words resonated with the tech community, emphasizing that Arm’s significance goes far beyond its potential as a merger partner.
Nvidia’s collaboration with Arm extends beyond rhetoric. The company is actively working with Arm on the development of a new cloud data center ecosystem. Historically, Intel’s x86 architecture has been the dominant force in data center servers. However, with Arm’s energy-efficient designs and Nvidia’s computational prowess, this partnership could usher in a new era for data center technology.
The collaboration aligns with the industry’s growing emphasis on energy efficiency, performance, and scalability. Arm’s architecture has already made significant dominance in data center servers, and Nvidia’s involvement could accelerate this trend.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
SoftBank's Arm to ask for $47 to $51 per share in IPO
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A woman with a Shein bag after entering its first physical store in Madrid, June 2, 2022.
Europa Press News / Contributor
Fast-fashion juggernaut Shein is facing more scrutiny from elected officials in the U.S. who want the company to prove it doesn’t use forced labor before it files for a widely rumored initial public offering.
Attorneys general from 16 states sent U.S. Securities and Exchange Commission Chair Gary Gensler a letter last week asking the agency to ensure Shein and other foreign companies are following U.S. law before they’re permitted to trade on American exchanges.
“It is apparent that SHEIN is attempting to launch an IPO before the end of this calendar year. An IPO of this magnitude—involving a foreign-owned company that is facing credible concerns about its core business practices—cannot move forward on self-certification alone,” the missive, written by Montana’s Attorney General Austin Knudsen and signed by 15 other Republican attorney generals, stated.
“We urge you to require, as a condition of being listed on a U.S. based securities exchange, that any foreign-owned company certify via a truly independent process that it is compliant with Section 307 of the Tariff Act of 1930, which prohibits the import of any product manufactured wholly or in part by forced labor.”
The letter was sent Thursday, the same day the company announced it was taking a stake in Forever 21’s parent company Sparc Group.
Shein has faced accusations that it used forced labor from the Xinjiang region in China to fuel its meteoric rise as rumors swirl that it is preparing to go public. The company’s supply chain has a large presence in China, where it was founded, but U.S. law prohibits imports from Xinjiang because of widespread human rights abuses against Uyghurs in the region.
The company is currently under investigation by the House Select Committee on the Chinese Communist Party, which has also accused Shein of evading U.S. tariff law. The probe comes as U.S. lawmakers from both parties increasingly scrutinize companies from China or those with potential ties to its government.
The letter cited a Bloomberg story published last year that showed, via independent testing, that some Shein clothes were made with cotton from the Xinjiang region.
Shein has faced enormous blowback from the report. The accusations have become a major hurdle the retailer must overcome before it can grow its presence in the U.S. and go public.
At the time of the Bloomberg report, Shein and its executives rarely spoke publicly. But since then, it has become more open to press, and has acknowledged to CNBC that some of its cotton supply has been found to come from the Xinjiang region.
To test its cotton, it contracted the supply chain tracing firm Oritain, which says it’s able to track the origin of cotton fibers down to specific farms. Between June 2022 and July 2023, it has conducted 2,111 tests, which resulted in 46 positive results, or a rate of 2.1%, from banned regions, Peter Pernot-Day, Shein’s head of strategy and corporate affairs, told CNBC.
“These are in raw materials so when we have a raw material positive test, that means that raw material is removed from production,” Pernot-Day said.
Oritain, which bills itself as an independent firm, previously confirmed those results to Politico and said Shein has fared better than the fashion industry on average.
Each year, the company tests more than 1,000 cotton samples. During a recent testing round across the industry, Oritain found 12% of samples came up positive for an “unapproved region,” Politico previously reported.
Pernot-Day said one of Shein’s primary objectives at the moment is to get its positive test results down to zero. To do that, it is conducting testing from all 40 of its mills each month, and stopped buying cotton from China altogether, Pernot-Day said.
Ant Group’s IPO was halted in 2020 after the Chinese government intervened, citing rising concerns about the company’s growth and potential systemic threats to the financial industry.
Chinese fintech giant Ant Group, backed by billionaire Jack Ma, has made headlines with its plan to undergo a strategic restructuring and cut ties with non-core operations. This bold move is intended to streamline its business strategy and prepare it for a renewed attempt toward a possible Initial Public Offering (IPO) in Hong Kong.
Ant Group Renewing Focus on Core Business Ahead of IPO
Anonymous sources familiar with the matter told Bloomberg that the restructuring will create a separate entity for obtaining a financial holding license in China, excluding blockchain, database management services, and international business from this entity.
This entity will be streamlined to include core operations that align with China’s financial regulatory requirements. Ant Group aims to demonstrate its commitment to responsible growth and compliance, which is critical for obtaining regulatory approval.
Ant’s current foreign business comprises Alipay+, a transaction network that supports cross-border payments among several digital wallets in a variety of nations. Additionally, the company operates WorldFirst, for small firms doing cross-border commerce, and ANEXT Bank, a Singapore-based digital wholesale bank launched in 2022.
If the restructuring is successfully completed and Ant Group secures a financial holding company license in China, it can prepare for an IPO in Hong Kong. While the prospect of an IPO in Hong Kong is exciting, there are still many uncertainties. It is worth mentioning that Ant Group’s intentions have not been finalized and may change.
Navigating Regulatory Challenges
The journey of Ant Group toward its IPO has been marked by challenges and regulatory hurdles. Ant Group’s IPO was halted in 2020 after the Chinese government intervened, citing rising concerns about the company’s growth and potential systemic threats to the financial industry.
Amid the regulatory crackdown on Ant Group, the proposed restructuring plan seems to be a beacon of relief. The plan not only aims to streamline the company’s core financial operations but also offers shareholders stakes in entities left out of the main operation at a nominal price.
The report highlighted that Ant Group has, ahead of the IPO plans, received approval from shareholders to initiate a share buyback program. This program allows the corporation to repurchase up to 7.6% of its shares for an estimated $79 billion. Shareholders have until early August to decide whether to participate in the share buyback program.
Alibaba Group Holding Ltd (HKG: 9988), which owns a third of Ant Group, has decided to stay out of the buyback process. The corporation has stated its intention to keep its current share in Ant Group, highlighting the significance of its collaboration with the fintech giant.
On the other hand, some Chinese state-owned firms that previously participated in Ant Group’s funding rounds are reportedly planning to take part in the share buyback. This move signals a show of confidence in Ant Group’s long-term prospects despite the regulatory challenges it has faced.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
Ant Group, a company backed by billionaire Jack Ma, is reportedly planning to restructure and cut ties to some operations that are not core parts of its Chinese financial business. The move prepares the company for a potential initial public offering (IPO) in Hong Kong.
Citing anonymous sources, mainstream media outlet Bloomberg reported that the firm relayed to its shareholders that the company is looking to leave its blockchain database management out of a main entity, which will then be applying for a financial holding license in China.
After completing its restructuring plans and securing the license, the company can prepare to go public in Hong Kong instead of its former approach of pursuing a dual Shanghai-Hong Kong listing.
In 2020, Ant Group targeted a $226 billion valuation by attempting a $30 billion IPO in Hong Kong and Shanghai. If it had been successful, the initial public offering would have been the largest in history, overtaking previous records such as the Saudi Aramco IPO, which raised $29.4 billion. However, the Chinese government intervened before the IPO came to fruition.
While the plans seem feasible, the report noted that it’s not yet finalized and may be subject to changes.
Blockchain firm Earlyworks announce IPO pricing on Nasdaq
Meanwhile, Japanese blockchain firm Earlyworks, which deals with grid ledger systems (GLS), has announced the pricing for its initial public offering of 1.2 million American depository shares. The shares will go for $5 each and have been approved for listing on the Nasdaq Capital Market.
According to a press release by Earlyworks, the funds from the offering will be used to invest in research and development for GLS and its system development kit (SDK). In addition, the company will also be onboarding new talent and strengthening its internal governance systems. The firm also highlighted that it will invest in blockchain businesses.
$ELWS Earlyworks Co Ltd is a Japan-based company mainly engaged in the information system development and operation outsourcing business. The Company is engaged in the planning, proposal, design, and development of system solutions using blockchain. The Company is also engaged in… pic.twitter.com/iytdi9yBJB
— Just Michelle (@MaryMichelleNay) July 25, 2023
Earlyworks’ GLS is a hybrid blockchain that integrates database technology for high-speed processing. Earlyworks aims to leverage this technology in various industries and offer engineers a general-purpose SDK.
Related: Allowing Coinbase to go public was not a ‘blessing’ from regulators — SEC
Other IPO news:
Earlier in 2023, layer-1 blockchain provider Chia Network said it filed a proposal for an IPO to the United States Securities and Exchange Commission (SEC). On April 14, the firm announced that it submitted an IPO registration to the SEC. The company did not provide many details about the offering and highlighted that the price range has not yet been determined. However, the IPO is expected to start once the SEC finishes its review process.
On June 30, Bitcoin Depot — one of the largest crypto ATM providers in the United States — announced that it would go public on Nasdaq after a merger with fintech firm GSR II Meteora. The company made its debut on July 3, with its stock price rising by nearly 12%.
Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.
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