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Both Palantir and Asana have gone public using the direct listing process instead of the traditional IPO method.
Software companies Palantir and Asana are going public through direct listings on the New York Stock Exchange. Launching today, September 30, the direct listing process will allow existing Asana and Palantir shareholders to sell stock to the public, unlike the traditional listing method. Also, the direct listing will allow the tech companies to sell shares without underwriters.
As both companies are taking the same approach to go public, Palantir and Asana also have other things in common. The software makers are backed by investors who made billions from Facebook Inc (NASDAQ: FB).
Palantir’s co-founder Peter Thiel was the first investor in Facebook. When the social media network was founded in 2004, Thiel invested $500,000. When Facebook went public in 2012, the investor sold 16.8 million shares to make nearly $640 million.
Shortly after his initial investment, Thiel further funded Facebook with $12.7 million in May 2005. Also, the investor participated in a $27.5 million round in April 2016. According to CNBC, Thiel has a net worth of over $2 billion and owns $2.4 billion worth of Palantir’s shares, priced at $7.25 per share.
In 2019 however, Thiel sold his remaining Facebook shares. Although he has no stake in Facebook anymore, the investor remains on the Facebook board.
The CEO and co-founder of Asana Dustin Moskovitz was a roommate to Mark Zuckerberg at Harvard. Moscovitz is also a co-founder of Facebook and left the social networking service in 2008. That year, Moscovitz co-founded Asana with Justin Rosenstein.
Before Facebook went public in 2012, the Asana CEO held a 7.5% stake. Including his current stake in Facebook worth over $8 billion, Moskovitz is worth more than $15 billion. Based on a stock price of $21 per share, the Asana co-founder also holds $1.1 billion of Asana’s stock.
Palantir and Asana Ahead of Direct Listing
Furthermore, Founders Fund, co-organized by Thiel, is an Asana investor and has a 6.5% stake in Asana. In 2012, Asana revealed that both Peter Thiel and Founders Fund are investors in the company. At the time, Asana also welcomed Thiel as the newest member of the board of directors.
Ahead of its direct listing, Palantir said it is expecting a 42% revenue growth this year, reaching $1 billion. The software maker revealed this in a filing on the 22nd of September. Also, the company is expecting a 30% revenue growth in 2021.
The CEO of pre-IPO market place Forge Kelly Rodriques commented on valuing the two companies as they move towards their direct listings. Notably, investors are more familiar with Palantir than Asana.
“Palantir has had a pretty active market for the stock with market-based pricing for years. It’s been down, up, down and back again.”
Government agencies and prominent companies use Palantir’s software in sorting large data sets. Recently, the US Department of Defenseannounced that it awarded over $91 million to Palantir for general research and development support of the Army Research Laboratory. As stated in the announcement, the project should be completed by the 28th of September, 2022.