Rivian goes public in one of the largest IPOs ever

Start-up of electric vehicles Rivian is now a listed company after completing one of the largest listings in history. Rivian shares began trading on the Nasdaq exchange on Wednesday at around $ 78 per share. It gave Rivian a total valuation of almost $ 80 billion and helped the company get $ 12 billion in fresh cash, despite only recently starting to make and ship its first electric pickups.

It is the sixth largest IPO ever on a US stock exchange, according to Bloomberg, and it’s hard to imagine the company choosing a better time to debut. Tesla has created an incredible amount of interest in electric cars and is now one of the most valued companies in the world. The public markets have also been on an outrageous run in recent years ̵[ads1]1; a run that was overloaded over the past 18 months by an influx of retailers and a boom in electric vehicle companies being listed.

Rivian, who has a steady CEO and founder and relatively modest goals for the next few years, can be a good test of all that hype. It has received a little more than 55,000 pre-orders for its expensive electric pickup (R1T) and SUV (R1S) and has said it will not be able to deliver all of these until the end of 2023. Where other EV startups went public with big promises of growth In the short term, Rivian has been very conservative in the few estimates it offers for what the next few years will look like, and has instead emphasized that it will largely focus on making vans for Amazon, which owns around 20 percent. of the start-up.

And yet, shares in Rivian jumped to $ 106 when they began trading on the Nasdaq exchange on Wednesday and climbed from there, lifting the company’s valuation well above $ 100 billion – higher than any other automaker on the planet except Tesla, Toyota, Volkswagen and China’s BYD .

Rivian’s startling valuation is likely to reinforce lazy comparisons with Tesla, despite the fact that the start-up begins production at a time when there is an observable desire for electric vehicles – which was not the case when Tesla started up, to say the least. And while many are likely to view Rivian’s appreciation as a good example of how hot the stock market is, at least one older automaker has already tried to prove it’s justified: General Motors CEO Mary Barra said Wednesday that Rivian’s valuation proves that older automakers are «So underrated». (GM almost had an agreement in place to become a major investor in Rivian in 2019 before the startup pulled out and took on money from its rival across town, Ford.)

Either way, the splashy debut is guaranteed to draw a lot of attention to the startup and its electric vehicles. It has also given the Rivian a decisive windfall, as it needs one a lot of money to grow – and survive – in the notoriously money-hungry car industry. Rivian lost $ 994 million in the first six months of 2021 alone and has said in regulatory records that it expects to spend another $ 8 billion by the end of 2023.

The start-up wants to make as many as 1 million cars per year by 2030 and says it will have all three different vehicles in production by the end of this year. It plans to sell versions of the van that will not be delivered to other customers within the next two years. It’s even looking for a place to build a second factory in addition to the one it operates in Normal, Illinois. And it already has a staff of almost 10,000 employees.

Originally founded in 2009, Rivian spent almost a decade operating in stealth mode. CEO and founder RJ Scaringe initially wanted to make an electric sports car more or less similar to the Tesla Roadster. But he rejected that plan along the way and moved the company towards developing an electric pickup and an SUV. R1T and R1S, as they are called, debuted at the LA Auto Show in 2018.

Rivian’s profile started to take off shortly after. In early 2019, it announced a $ 700 million financing round led by Amazon and then a $ 500 million investment from Ford. Later that year, Amazon announced that it was helping Rivian develop an electric van and that they ordered 100,000 of them from the start, marking what would be the largest single purchase of electric vehicles in history.

Now, with pickup trucks starting to drive on the road and the van and SUV soon to follow, Rivian has become something that is still rare in the industry: a listed EV company with actual vehicles for sale. There are some startups that Faraday Future, Canoo, Fisker Inc., Lordstown Motors and Nikola – all of which have been listed over the past year and a half – are still months away from being able to say.

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