In a move that could potentially reignite the IPO market, Instacart Inc., the leading US online grocery-delivery company, is reportedly gearing up for an initial public offering as early as September, according to insiders familiar with the matter. The company’s decision marks a shift from previous considerations of a direct listing, instead opting for a traditional IPO on the Nasdaq.
Insiders, who chose to remain anonymous due to the confidentiality of the information, have revealed that Instacart may unveil its IPO plans with the US Securities and Exchange Commission next week, offering fresh momentum to an IPO market that has seen periods of lukewarm activity. The listing could coincide with other major players entering the public market, such as chipmaker Arm Ltd., which is anticipated to launch an IPO and raise between $8 billion and $10 billion in September.
Further enhancing the resurgence in the IPO landscape, marketing and data automation provider Klaviyo is reportedly considering publicly disclosing its financials next week, followed by a potential listing of its shares in September. However, both Klaviyo and Instacart spokespeople have refrained from commenting on these speculations.
Despite the overall decline in IPO activity this year compared to the record-setting 2021, with only $14 billion raised on US exchanges so far, Instacart’s potential offering, along with other impending IPOs, could invigorate the market and reshape the trajectory of this year’s listings.
As part of its upcoming IPO filing, Instacart is expected to divulge fresh insights into its financials and operational scope. While the initial document might feature preliminary details about the offering, the specifics of the share sale’s size and price will likely follow in subsequent filings.
Instacart had initially taken steps towards going public in the past, disclosing its confidential SEC filing for an IPO in 2021. During this time, it was reported that the company was collaborating with financial giants such as Goldman Sachs Group Inc. and JPMorgan Chase & Co. However, the turbulence in the market prompted Instacart to postpone its IPO plans, as CEO Fidji Simo cited the “extremely tumultuous” market conditions as unfavorable for an IPO in the same year. This followed a series of valuation adjustments, with the company’s internal valuation dropping to around $13 billion from an earlier estimation of $24 billion.
Having already secured $2.74 billion as a startup, Instacart’s journey towards an IPO showcases its resilience and adaptability. Its impressive roster of investors, including notable names like Tiger Global Management, Coatue Management, and D1 Capital Partners, stands as a testament to its growth trajectory and potential impact on the IPO market’s recovery.