Klaviyo priced its IPO at $30 per share, offering 19.2 million shares to the public. This pricing valued the company at $9 billion on a fully diluted basis.
Klaviyo, the renowned marketing automation company, made waves on Wall Street as its shares surged by an impressive 9.2% during its debut on the New York Stock Exchange (NYSE) after its Initial Public Offering (IPO).
This success is noteworthy not only for Klaviyo but also for the entire tech industry, as it constitutes the first notable Initial Public Offering for a venture-backed software business in the United States since late 2021. However, it’s worth noting that the stock did close at $32.76, showing some decline throughout the day after an initial opening at $36.75.
Klaviyo’s Journey to the NYSE
Klaviyo’s path to its NYSE debut was marked by significant growth and a commitment to innovation. The company has secured multiple rounds of funding from prominent venture capital firms, further solidifying its position as a top contender in the marketing technology space.
With a valuation estimated at $8.7 billion during its IPO, Klaviyo has positioned itself as one of the most valuable software companies to go public in recent years.
Klaviyo priced its IPO at $30 per share, offering 19.2 million shares to the public. This pricing valued the company at just over $9 billion on a fully diluted basis. Of these shares, 11.5 million were sold by the company itself, resulting in a substantial $345 million cash injection into Klaviyo’s balance sheet.
This valuation was slightly lower than the $9.5 billion valuation reached by the company during a private fundraising round in 2021. Nonetheless, it represented a significant milestone for Klaviyo as it transitioned from a venture-backed software company to a publicly traded one.
Klaviyo’s IPO commenced under the ticker symbol “KVYO” on the NYSE. The IPO came just a day after Instacart (NASDAQ: CART), a grocery delivery company, debuted on the Nasdaq, witnessing a 12% increase in its stock price following an initial 40% surge. Both Klaviyo and Instacart aimed to break open a tech IPO market that had been relatively dormant for nearly two years.
The Resilience of Klaviyo
While chip designer Arm did go public the previous week, it’s important to highlight that Arm is based in the UK and controlled by Japan’s SoftBank Group Corp (TYO: 9984), making Klaviyo’s IPO especially significant for US-based tech companies.
The tech IPO landscape had been relatively dormant until Klaviyo’s recent debut. The last venture-backed software companies to go public in the U.S. were HashiCorp (NASDAQ: HCP) and Samsara Inc (NYSE: IOT), both of which had their IPOs in December 2021.
At that time, the Nasdaq was reaching new heights, and investors were eagerly seeking growth stocks. However, the climate shifted in 2022 as inflation spiked and interest rates rose, leading to a risk-averse attitude among investors. This culminated in the worst year for tech stocks since the 2008 financial crisis.
While 2022 was challenging for tech stocks, 2023 has seen a resurgence in the Nasdaq. In its IPO prospectus, Klaviyo reported impressive revenue growth of 51% in the latest quarter, reaching $164.6 million. The company has also achieved profitability, reporting a net income of $10.9 million after a $11.7 million loss the previous year.