Venture-backed marketing software company, Klaviyo, has increased its expected price range for its initial public offering (IPO) this week. The updated IPO filing with the SEC reveals that Klaviyo plans to offer shares at a price range of $27 to $29, up from the previous estimate of $25 to $27 per share. The company will be listed on the New York Stock Exchange under the ticker symbol "KVYO." The offering is set to be priced on Tuesday night and trading will commence on Wednesday.
This IPO marks the third tech IPO in recent times, following a period when the new issue window for tech stocks remained closed. ARM Holdings, a UK-based chip design house, went public last week at $51 per share and experienced a significant 25% rally. Meanwhile, Instacart parent MapleBear, expected to trade under the ticker symbol "CART," is anticipated to price its long-awaited public offering after the close of trading on Monday, with trading set to begin on Tuesday.
Established in 2012, Klaviyo assists companies with their digital marketing campaigns, utilizing email, text messages, and other notifications. The company faces competition from industry giants such as Adobe (ADBE), Salesforce (CRM), and MailChimp (owned by Intuit INTU).
The IPO offering comprises 19.2 million shares, with 11,507,693 million shares allocated for selling shareholders. Among these, approximately 5 million shares are from venture firm Summit Partners. Post-offering, Summit Partners will hold around a 21% voting interest in Klaviyo. Fully diluted, Klaviyo will have approximately 306 million shares outstanding after the offering, resulting in a valuation of about $8.9 billion at the top of the revised target range.
Klaviyo: Transforming E-commerce with Striking Growth
Klaviyo, the e-commerce software firm, is making waves in the industry with its rapid growth and innovative strategies. As the company prepares for its initial public offering (IPO), let's delve into the key details that make Klaviyo a standout player in the market.
Stock Structure: A Tale of Two Shares
Klaviyo has two classes of stock: A shares and B shares. Interestingly, the B shares hold significant power, boasting an impressive 10 voting rights each. Insiders currently control the majority Class B shares, with over 99% of the voting interest in the stock.
Shopify's Strategic Stake
Shopify (SHOP), a renowned player in the e-commerce world, is set to hold an 11.5% voting interest in Klaviyo post-offering. With a stake worth approximately $840 million at the top of the updated expected price range, this equates to just over 1% of Shopify's market value.
The Visionary Behind Klaviyo
CEO and co-founder Andrew Bialecki will retain a substantial 39% voting control of Klaviyo after the IPO. This showcases his ongoing dedication and commitment to driving the company forward.
A Thriving Partnership with Shopify
Recent research conducted by Roth MKM analyst Rohit Mulkarni highlighted Klaviyo's strong reliance on Shopify customers. In fact, a staggering 80% of the company's annualized revenue comes from this partnership. This collaborative synergy has undoubtedly contributed to Klaviyo's meteoric rise.
Impressive Financial Performance
Klaviyo's financials speak volumes about its remarkable growth trajectory. In the first half of this year, the company generated $246.6 million in revenue, marking an impressive 64% increase compared to the same period last year. Moreover, its 2022 full-year revenue reached $344.7 million—showing a remarkable 67% surge from the previous year.
In addition to its stellar revenue growth, Klaviyo achieved profitability this year, with a net income of $15.2 million for the first six months. Its trailing 12 months revenue stands tall at $585.1 million, reflecting an exceptional 56.5% increase.
Strong Investor Support
Klaviyo's IPO has garnered significant support from notable investors. BlackRock and AllianceBernstein have committed to purchasing up to $100 million of the company's stock at the IPO price, further solidifying their confidence in Klaviyo's potential.
Powerhouse Underwriters
Leading the way as underwriters for Klaviyo's IPO are Goldman Sachs, Morgan Stanley, and Citigroup. Their extensive expertise and industry knowledge are pivotal in ensuring a successful offering.
In summary, Klaviyo's pioneering strategies, monumental growth rates, and strategic partnerships make it a formidable force in the e-commerce landscape. With its IPO on the horizon, the company's future looks exceptionally promising.
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