A quick update to our piece yesterday concerning the repricing of Blue Apron, something that the public markets continued today.
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As you recall, some companies may face issues going public under tech or growth sales multiples if the street disagrees with private investors’ purportedly fair price-revenue metrics.
Whatever the cause, Blue Apron is off 8.77 percent in regular trading, as of the time of writing. The firm, now selling for just $8.06 per share, is off 19.4 percent from its IPO price of $10.
The firm is off a steeper 52.59 percent from the upper-end of its initial IPO range. And that’s why we are bringing you this update.
These pages published a piece entitled “Blue Apron’s Up IPO Not A Wild Surprise As Unicorns Fare Well In 2017” before the company slashed its IPO pricing. At the time, the firm seemed set to price substantially above its final private valuation.
That didn’t work out.
This matters for unicorns that are less tech-heavy than their peers (Palantir? Vice? Zenefits? Mobike?) which may have to endure similarly heavy winds when they eventually seek liquidity for their investors.
If there are more Blue Aprons out there, waiting for a public-market repricing, it could be that vast tranches of late-stage capital were misallocated. Early investors in unicorns, provided that they aren’t diluted to homeopathic levels of financial impact, should be fine.1
- Read: Zero.
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