Shopify-Backed Klaviyo Jumps Up to 32% in Trading Debut

Marketing and data automation provider Klaviyo Inc. rose as much as 32% in its trading debut after exceeding the marketed range in its initial public offering to raise $576 million.

(Bloomberg) — Marketing and data automation provider Klaviyo Inc. rose as much as 32% in its trading debut after exceeding the marketed range in its initial public offering to raise $576 million.

The IPO is the third major US listing in the past week, following grocery delivery company Instacart and Arm Holdings Plc, the semiconductor designer owned by SoftBank Group Corp. Opening day gains by all three show investors are willing to put money into newly public companies after a nearly two-year dearth of new listings on US exchanges.

While the company is less well known than Arm or Instacart, the email marketer, which sells to other businesses, is a more “bread and butter” technology IPO. Other private companies serving enterprises will be watching Klaviyo’s stock performance closely to see if they should also test the public waters. 

Klaviyo’s shares opened trading Wednesday at $36.75 after selling for $30 each in the IPO. The company and selling stockholders had marketed 19.2 million shares for $27 to $29.

The shares were up 19% to $35.56 at 12:49 p.m. in New York trading, giving the Boston-based company a market value of about $9 billion. Including stock options and restricted share units, the company’s fully diluted value is closer to $10.7 billion.

Like Arm and Instacart, Klaviyo signed up cornerstone investors. BlackRock Inc. and AllianceBernstein LP expressed interest in buying as much as $100 million of the IPO shares in aggregate, according to Klaviyo’s filings with the US Securities and Exchange Commission.

Klaviyo had net income of about $15 million on revenue of $321 million for the first six months of the year, compared with a loss of $25 million on revenue of $208 million for the same period last year, according to the filing.

The company’s investors include growth equity firm Summit Partners, e-commerce platform Shopify Inc. and venture firms Accomplice and Accel. Summit is selling 4.9 million shares in the IPO, while Accomplice is selling almost 1.8 million.

Klaviyo’s largest shareholder will remain co-founder and Chief Executive Officer Andrew Bialecki, who will control 39% of the voting power, followed by Summit with 21%, according to the filings. Bialecki, 37, studied physics, astronomy and astrophysics at Harvard before founding the company in 2012. 

The offering is being led by Goldman Sachs Group Inc., Morgan Stanley and Citigroup Inc. Klaviyo’s shares are trading on the New York Stock Exchange under the symbol KVYO.

–With assistance from Bailey Lipschultz.

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