11 Hot Upcoming IPOs to Watch For in the Rest of 2021
The most exciting initial public offerings (IPOs) expected during the remainder of 2021 range from an Amazon-backed EV play to a food delivery app to a sustainable shoemaker.
The initial public offering (IPO) market overcame a lightning-quick bear market in 2020 to bounce back to levels not seen since the dot-com boom. And even though there are just a few months left in the year, there's still a laundry list of upcoming IPOs for 2021, as a host of companies plan on tapping Wall Street for much-needed capital.
Some of 2021's IPO highlights? In February, shares of female-led dating-app operator Bumble (BMBL) rocketed well more than 60% higher in their public debut. In March, online gaming platform Roblox (RBLX) enjoyed a 54% first-day jump after its offering. And in July, language-software company Duolingo (DUOL) delivered a 36% return in its first session as a publicly traded company.
You can thank a rapid snap-back rally and rock-bottom interest rates for rejuvenating Wall Street's wheeling and dealing. But there are other factors at play:
- The mega-trend of digital transformation continues to thrust more companies into the public markets. Many companies realize that to remain competitive, they must adopt modern technology such as cloud computing, analytics an artificial intelligence – and that has meant a vibrant technology-sector IPO market in 2021.
- Also, venture capital markets have been flush with cash for the past decade. They have spent that cash by investing in thousands of startups, which has allowed them to quickly scale. The next logical step: The IPO, which provides still more capital … and gives founders, employees and VCs a way to cash in.
- Thanks to pushes from the likes of online brokerage Robinhood (HOOD), trading stocks has become free (or much cheaper) for most investors. That has helped spur larger numbers of young investors looking for high-growth opportunities, like IPO stocks.
In light of this, it seems like a good bet that the momentum will continue for initial public offerings.
Here, we look at 11 of the most anticipated upcoming IPOs for the rest of 2021. Right now, that list includes potential blockbuster offerings such as the Instacart, Allbirds and Discord IPOs.
Data is as of Sept 16. Where possible, we have provided reported expectations for timelines and/or valuations.
Allbirds
- Expected IPO timeline: October 2021
- Estimated IPO valuation: N/A
As a professional soccer player in New Zealand, Tim Brown fielded multiple offers to sponsor shoes. The problem? He often didn't enjoy the fit or the use of synthetic materials.
So he made his own.
Brown won a $200,000 research grant from the wool industry and, with a team of scientists, designed a new type of sneaker focused on sustainability, comfort and performance. Brown also set up a Kickstarter campaign to raise money and find customers, and he ultimately was connected with renewable-materials expert Joey Zwillinger. They partnered together to form Allbirds.
By 2016, the cofounders launched their shoe, the Wool Runner. Despite operating with a small marketing budget, the company was able to sell 1 million units within a couple years.
The company has continued to innovate its designs, and its sourcing. For instance, one of its most recent shoes is made of merino wool and yarn from the pulp of eucalyptus trees.
Allbirds' niche has caught on, especially with younger consumers. Revenues have rocketed to $219.3 million in 2020, from $126 million in 2018. It also has begun to build a retail footprint, with 27 stores currently.
Expect an October IPO that sees Allbirds list on the Nasdaq under the ticker "BIRD."
iFit Health & Fitness
- Expected IPO timeline: October 2021
- Estimated IPO valuation: $7 billion
The name iFit Health & Fitness might imply a younger startup, but the company has been around since the late 1970s. Founders Scott Watterson and Gary Stevenson – a pair of University of Utah students – started out by importing Asian kitchen and tableware. But by the early 1980s, the business shifted toward fitness equipment.
Over the years, iFit has assembled an impressive set of assets, such as NordicTrack, Proform and Freemotion. And today, the company is the No. 1 provider of large fitness equipment in the U.S.,
Also, iFit has been aggressive in investing in technology; today, its new devices are connected via the cloud and mobile apps. The software systems use biometric data to optimize workouts – in real time. It also boasts compelling interactive content, such as with live studio and outdoor workouts. Last year, the company streamed 142 million hours of live and on-demand content. Its user base of more than 6.1 million users includes 1.5 million paying subscribers.
The pandemic was good to iFit, too: For the 12 months ended May 31, 2021, revenues more than doubled to $1.7 billion.
The iFit IPO should occur sometime in the next month. The company – which plans to list on the Nasdaq under the ticker "IFIT" – is expected to be valued at around $7 billion.
Rivian
- Expected IPO timeline: October-November 2021
- Estimated IPO valuation: $80 billion
Rivian, which launched in 2009, is one of the pioneers of the autonomous electric vehicle (EV) market. Founder Robert "R.J." Scaringe graduated from the Massachusetts Institute of Technology with a doctorate in mechanical engineering and had a vision of completely remaking the traditional automotive market.
Building the technology was no easy feat – Scaringe had to spend considerable sums not just on R&D but also large manufacturing facilities. EVs also require a power charging network. But Rivian has had the help of some major backers, including Amazon.com and Ford (F).
The company has reached the point of commercialization. In 2021, Rivian plans to begin delivery of its two consumer vehicles: a pickup truck (R1T) and a sport utility vehicle (R1S). Also, Amazon has a standing order for 100,000 commercial delivery vans.
For this ramp-up, Rivian recently raised $2.65 billion from investors including T. Rowe Price Associates, Fidelity Management, the Amazon Climate Pledge Fund, Coatue and D1 Capital Partners. The company has raised a total of $8 billion.
However, this should be the last round before an IPO, which is expected to hit the markets this fall. The company registered confidentially with the SEC in August, and sources familiar with the matter said the company is aiming for a late October or November listing. They add that Rivian is looking to raise between $5 billion to $8 billion at a valuation of roughly $80 billion.
ThoughtSpot
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: N/A
ThoughtSpot founder Ajeet Singh has actually helped build two billion-dollar companies.
Singh co-founded cloud infrastructure and services firm Nutanix (NTNX), a roughly $5 billion firm, in 2009. He believed that cloud computing would be a mega-trend and that businesses would have a need for highly scaled infrastructure software (and he was right). Nutanix eventually went public in September 2016.
But Singh wasn't around for that. He left in 2012 to target another huge technology trend: analytics and AI. So Singh would found ThoughtSpot, whose platform allowed organizations to integrate myriad sources of data and to set up sophisticated dashboards.
Co-founder Amit Prakash has an extensive background in the analytics space, including time as a leader on the engineering team for Google's AdSense business. Before that, he served as a founding engineer for Microsoft Bing, where he helped to develop the page rank algorithms.
The analytics market has seen plenty of dealmaking over the past couple of years. The highlights include Salesforce.com's (CRM) whopping $15.7 billion buyout of Tableau in summer 2019, and Alphabet's (GOOGL) $2.6 billion acquisition of Looker around the same time frame.
While there are no firm estimates on a possible IPO valuation of ThoughtSpot, its last round of funding was a Series E in August 2019 in which it raised $248 million at a valuation of nearly $2 billion.
Expected timing for an IPO is fall 2021.
Authentic Brands Group
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: $10 billion
Who says malls are dead?
Well, certainly not Jamie Salter, who is making a big bet on the market.
Salter, who got his start in the snowboard business in the early 1990s, has parlayed his retail expertise into building Authentic Brands Group. He launched the business in 2010 and invested $250 million of his own funds. He also got the backing of Leonard Green & Partners, a top private equity firm.
Authentic Brands Group is focused on acquiring struggling businesses such as Aeropostale, Barneys New York, Brooks Brothers, Eddie Bauer, Forever 21, Nautica and Nine West. But not all of its businesses are retailers. Salter also has acquired Sports Illustrated, as well as intellectual property of celebrities including Marilyn Monroe, Muhammad Ali and Elvis Presley.
Salter has partnered with mall giants such as Simon Property Group (SPG) and Brookfield Property Partners LP (BPY) to leverage the dealmaking. He also raised $875 million from BlackRock (BLK) in 2019.
Authentic Brands recently filed its S-1, and it shows a consistently strong growth ramp. From 2016 to 2020, revenues increased at a compound annual growth rate of 31% to $489 million last year. Profits have been growing even more rapidly, at 47% to $211 million in the same time frame.
Authentic Brands' IPO is slated for August, and the company expects to fetch a valuation fo $10 billion, which would make it one of 2021's biggest offerings. The company will list its shares on the New York Stock Exchange under the ticker AUTH.
The Fresh Market
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: N/A
Gourmet grocery chain The Fresh Market is making another go at publicly traded life.
In March 2016, The Fresh Market accepted a $1.36 billion cash buyout from private equity firm Apollo Global. At the time, the grocer was having trouble competing against companies such as Whole Foods (now held by Amazon), Kroger (KR) and Publix.
As a private company, The Fresh Market has been focused on restructuring its operations, which currently span 159 locations across 22 states. That paid off after a couple of years with an improvement on its credit outlook, though if the firm does go public, it will do so with a still-high level of debt.
And a year ago, the company hired a new CEO, Jason Potter – the former chief of Canada-based Sobeys who boasts three decades of experience in the grocery industry, and who is known as a cost-cutter.
The IPO looks to be little more than a way for Apollo to exit its investment with a decent return. The company filed confidentially in March for an eventual IPO, which is expected to happen later this quarter.
Instacart
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: N/A
In 2010, Instacart founder Apoorva Mehta left his post as the Fulfillment Optimization SDE at Amazon.com to move to San Francisco and start his own venture. And he ran into a lot of speed bumps, trying out 20 different products to no avail.
But he finally hit upon something with promise: an on-demand network for delivering groceries and other products. At the heart was an app that connected contractors – who did the shopping – with customers.
The pandemic turned 2020 into a game-changer for Instacart. The emergence of COVID-19 has spurred millions of people to adopt app-based delivery services.
Instacart has built a sophisticated logistics system, which involves agreements with more than 400 retailers spanning over 30,000 stores. That network translates into a reach of about 80% of U.S. households and 70% in Canada.
Instacart has still been busy raising funds, including a $200 million round from Valiant Peregrine Fund and D1 Capital Partners, following a $225 million raise in June led by DST Global and General Catalyst, with D1 participating. But Financial Times reported in early October that the company was consulting with banks ahead of a potential IPO, expected sometime in the first half of 2021.
The most recent round of fundraising valued the company at $39 billion, which is more than twice what it was valued at in a round five months ago. So while there's no hard estimate on an offering valuation, the Instacart IPO should be one of the largest of 2021.
NerdWallet
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: $5 billion
Tim Chen and Jacob Gibson started NerdWallet in the summer of 2009 with a mere $800 in capital to work with. As it turned out, that was more than enough to start putting together a site that helped people with their credit cards as they struggled amid the Great Recession.
Since then, NerdWallet's growth has exploded, and the site has expanded to cover numerous aspects of personal finance. The company generates over $150 million in annual revenues across more than 100 million users.
A critical part of NerdWallet's strategy has been acquisitions. That includes a 2020 deal for Fundera – a marketplace for businesses to obtain loans. NerdWallet is looking for increasing scale to compete with the likes of Credit Sesame, which is a roughly $1 billion company, and Credit Karma, which Intuit (INTU) bought last year for $7.1 billion.
NerdWallet has hired Morgan Stanley to manage its IPO, according to a Reuters report that cites people familiar with the matter. While NerdWallet's last fundraising, in 2015, valued the company at around $530 million, the company is looking to go public at a $5 billion valuation.
Discord
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: $10 billion-plus
When Jason Citron and Stanislav Vishnevsky were building online games, they had ongoing communications issues with their remote developer teams. The comm systems they evaluated didn't have the features they needed, so they did what many of us couldn't do:
They built their own.
The resultant system, Discord, which allowed for instant messaging, video and voice calls, was popular with gaming communities on Twitch and Reddit in the early days. The system was released in 2015; by 2018, Microsoft's (MSFT) Xbox had agreed to integrate the platform with Xbox Live accounts.
But in 2020, Discord announced a concerted effort to expand beyond gaming. To help with this, the company raised $100 million late last year at a valuation of $7 billion.
The COVID-19 pandemic had a positive impact on Discord's user base. Monthly active users (MAUs) doubled in 2020 to 140 million, and revenues jumped from $45 million to $130 million.
More recently, Microsoft made overtures to acquire the company for at least $10 billion. But the deal fell apart, according to a Wall Street Journal report. Several other suitors expressed interest, though names were not disclosed.
The next step now appears to be an IPO, though the planning remains in the early stages and a deal might not happen until later this year.
Databricks
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: $28 billion
A little more than a decade ago, a group of computer science students at the University of California, Berkeley created Apache Spark, an open-source system meant to manage big data. The platform achieved massive adoption alongside growing needs to use systems such as artificial intelligence and machine learning.
A few years later, those students would go on to launch Databricks to commercialize the software for enterprises. Over the years, the company has amassed a customer base of more than 5,000, which includes large corporations such as CVS Health (CVS), Comcast (CMCSA), Condé Nast and Nationwide.
Databricks' latest funding round came in early February, when the firm raised $1 billion, bringing its total amount raised since inception to close to $2 billion. Databricks was valued at $28 billion, and investors included Franklin Templeton, Fidelity, Microsoft, Amazon Web Services, and Salesforce Ventures.
While Databricks has not filed its IPO documents yet, the company appears to be angling for an IPO sometime this year.
Ascensus
- Expected IPO timeline: Fall 2021
- Estimated IPO valuation: $3 billion
Ascensus is one of the oldest companies in this list of upcoming IPOs for 2021, launching in 1980 as The Barclay Group (not to be confused with Barclays) to provide services for the 401(k) market. This came just as the U.S. was about to make a massive transition in retirement planning, shifting from pensions to self-directed options.
Ascensus has since diversified its business, primarily via an aggressive M&A strategy. Besides a thriving 401(k) business, Ascensus also provides services for 529 college funds and Health Savings Accounts (HSAs). The company says it has more than $327 billion in assets under administration, with more than 3,700 employees, and it has extensive distribution through a large network of financial advisors.
Recently, Ascensus has been investing in improving its technology. One such example was its launch of a personalized sales system for representatives that automates the proposal process.
Ascensus has already hired Wall Street bankers – Barclays and Goldman Sachs – to put together the offering documents. A deal is expected to hit a value of $3 billion and hit the markets sometime in 2021.
