Which companies may IPO in 2021?
With a new year upon us, which technology companies may go public over the next 12 months?
Poshmark
Clothing marketplace Poshmark filed for an IPO in late 2020. It is a popular site for consumers to sell secondhand clothes, beauty, and home décor products whilst heavily relying on social media in which buyers and sellers interact and share “likes” and “comments” about items as well as buying items.
The company last raised funding in 2017 at a $625 million valuation and has cumulatively raised around $160 million according to PitchBook. Poshmark’s IPO will be heavily compared to ThredUp’s (more on ThredUp later), a similar clothing resale business also looking to go public — though the two have very different business models.
Affirm
Similarly to Roblox, fintech company Affirm was scheduled to IPO in 2020 before pulling the offering due to the huge debuts from Airbnb and DoorDash. The company was founded by Max Levchin, the co-founder of Paypal and it helps 6,500 merchants and 6.2 million customers pay for goods online without a credit card. It is a consumer lending company that allows people to break big-ticket purchases into a series of smaller payments, including from retailers like Expedia, Walmart and Peloton.
Affirm had gross merchandise volume of $4.6 billion in 2020, which was up 77% year-over-year. In the first quarter of the current fiscal year, Affirm had revenues of $174 million, which was up 98% year-over-year.
Coinbase
Coinbase is a cryptocurrency exchange, estimated to hold around 5.4% of all Bitcoin in circulation. It has recently started expanding into institutional investing too, acquiring broker platform Tagomi.
Founded in 2012 as a simple way for consumers to purchase Bitcoin, Coinbase has since become a conglomerate of crypto-related business and the standard-bearer for an industry long regarded with suspicion by regulators and the traditional financial establishment.
It has raised $525 million, with the bulk of that coming from a $300 million funding round in 2018. That round valued it at just over $8 billion, and it hasn’t raised further investment since.
Bumble
Bumble, the dating app where women make the first move, has filed confidentially for an initial public offering, according to people familiar with the matter. The company reportedly plans to go public in February, possibly around Valentine’s Day, and could aim for a valuation between $6 billion and $8 billion.
Bumble is known for its dating app, but the company also owns Badoo, another popular dating site. Bumble has around 100 million users, but the combined apps under the Bumble company reach around 600 million people, according to Fast Company.
Whitney Wolfe Herd is the founder of Bumble after being a big part of the early days of Tinder. She started Bumble with the help of MagicLab’s Andrey Andreev, a Russian billionaire who provided the initial funding for a stake in the company. However, after a Forbes investigation revealed claims of rampant misogyny in the workplace, Andreev sold his stake in MagicLab to Blackstone as part of the 2019 deal, and Wolfe Herd became CEO of the company.
UiPath
Fast-growing robotic process automation startup UiPath has filed confidential paperwork for an initial public offering that will likely come in the first half of 2021.
UiPath creates bots that help companies do “mindless” tasks like data entry, making it one of the biggest names in robotic process automation. The company is one of the hottest startups in the emerging RPA market. RPA is a subset of artificial intelligence that involves using software robots to observe workflows in common business applications and then deduce ways to automate repetitive tasks.
The company has raised around $1.2 billion, including a $225 million round in July that valued the company at $10.2 billion, according to PitchBook.
Roblox
Free-to-play gaming platform Roblox has grown in popularity since the beginning of the pandemic, especially among children. It had around 31.1 million daily active users in the first nine months of 2020, up 82 percent from a year earlier. Inside the Roblox online universe, players’ avatars can interact and play millions of unique games set in different worlds, from tropical islands to haunted castles. Players pay money for premium memberships, as well as for items and clothing for their avatars.
Roblox is a founder-run company, and CEO and co-founder David Baszucki officially launched Roblox in 2006 after working on it for a couple of years. Altos Ventures invested in the business, currently owning over 21% of the company.
Roblox had been preparing to go public in 2020 but has decided to delay its initial public offering until 2021, after reassessing its pricing strategies in the wake of the Airbnb and DoorDash IPOs.
ThredUp
Online resale clothing firm ThredUp has filed a confidential registration statement for an initial public offering yet has not determined the size or price range for the offering.
ThredUp was founded in 2009 and has raised more than $305 million in venture funding, according to Crunchbase. The San Francisco-based company’s most recent valuation, following a $175 million Series F funding in September 2019, was $650 million. That round was led by Irving Investors and Park West Asset Management.
Ecommerce is a category that has done well in certain sectors this year, however ThredUp will still face a struggle to differentiate itself from other secondhand retailers like Poshmark during its IPO process.
Instacart
CEO Apoorva Mehta co-founded Instacart alongside Max Mullen and Brandon Leonardo in 2012. The San Francisco-based company provides an online marketplace with delivery and pickup services. It is considering a 2021 IPO and it could value the company at $30 billion.
It expanded to partner with 150 retailers, offer delivery for 8,000 stores and introduce pickup for 1,500 stores. Although originally designed for groceries, Instacart now works will retailers such as Sephora, 7-Eleven and CVS Health. This allows consumers to shop for nearly anything through the app without ever leaving the comfort of home.
Instacart has raised an estimated $2.47 billion, including a $200 million round in October that valued the company at $17.7 billion, according to PitchBook.
Flipkart
Flipkart is India’s biggest online retailer, estimated to have a 66% market share. It also owns popular mobile wallet PhonePe, though it partially spun off the business in December.
Flipkart raised over $7 billion before its acquisition by Walmart, which valued the company around $20.8 billion. Earlier this year, Walmart led a $1.2 billion funding round in the company at a $24.9 billion valuation. Walmart will be the biggest winner in an IPO, owning around 82% of the company. But it’s not the only one: Tencent, Tiger Global, Microsoft and Accel all own stakes too, as does co-founder Binny Bansal.
Robinhood
Stock trading app Robinhood Markets has picked Goldman Sachs to lead preparations for an initial public offering which will be at more than $20 billion.
Robinhood was valued at $11.7 billion in its last private fundraising round in September. Such a jump in valuation would underscore the growth of its platform, which has helped popularize trading among millennials and fuelled amateur stock picking during the COVID-19 pandemic lockdowns.
While it’s best known for its stock-trading features, Robinhood has far grander ambitions. It has launched cryptocurrency trading and a debit card, and even bought a financial media company.
Marqeta
Marqeta provides a series of APIs that allow other companies to issue cards. For instance, Instacart uses it to issue their drivers with debit cards that they can use to pay for customers’ deliveries. It offers some innovative features on top of that, such as real-time transaction authorization.
The company has raised over $527 million, according to PitchBook, with a valuation of around $4.3 billion as of May 2020.
Marqeta is backed by Goldman Sachs Group and Visa, and is planning to file for an initial public offering early this year, according to a Bloomberg report citing sources.
Databricks
Databricks solves a big problem for organizations: figuring out how to combine information stored disparately across the enterprise so it can be more effectively analyzed. The company’s platform also allows data scientists to collaborate on building predictive AI models on top of it to generate useful insights.
Databricks was most recently valued at $6.2 billion following a $400 million Series E funding round in October 2019, but Bloomberg’s sources say the company aims to go public at a “significantly higher” price than that valuation.
It is backed by some of the well-known venture capitalists, including Andreessen Horowitz, Coatue Management, New Enterprise Associates, Tiger Global Management, BlackRock Inc. and T. Rowe Price Group Inc. It has also received funds from Microsoft Corp.’s investment arm, and integrates its platform with that company’s Azure cloud platform.
Ant Group
Ant was set to have a big IPO in 2020, with plans to raise around $35 billion. But those grand plans came to a screeching halt when Chinese authorities — reportedly directed by Xi Jinping — forced the company to pull its listing. The company is now conducting a “comprehensive self-review,” and it is unclear when it will be ready to re-list: Bloomberg reports it could be as late as 2022.
The fintech giant started out as a mobile payments application, but has since expanded to become a comprehensive financial technology company. It licenses out its platform to financial services companies so they can offer loans, insurance and investment options on Alipay. Until now, the vast majority of loans on its platform have been offered by third parties, rather than Ant itself — but new rules might change that.
Ant’s raised around $23 billion to date and was expected to be valued around $313 billion in its IPO.