Digital marketing software firm, Klaviyo, is set to make its debut on the New York Stock Exchange (NYSE) under the symbol "KVYO" this week. The company has recently increased its initial offering price range from $25-$27 to $27-$29 per share, according to a Securities and Exchange Commission filing on Monday.
The forthcoming offering consists of 19.2 million shares, with nearly 11.51 million allocated for selling shareholders. Venture firm Summit Partners, a significant shareholder, will contribute almost 5 million shares and retain approximately 21% voting interest in Klaviyo post-offering.
Klaviyo's public offering comes after a period of inactivity in tech stock listings, with the company being the third tech firm to go public recently. Arm Holdings (NASDAQ:ARM), a UK-based chip design firm, and MapleBear, the parent company of Instacart, have also made moves toward public offerings.
Established in 2012, Klaviyo competes directly with prominent companies like Adobe (NASDAQ:ADBE), Salesforce (NYSE:CRM), and MailChimp in providing digital marketing solutions through email, text messages, and other notifications. Following the offering and considering full dilution, the company's estimated valuation stands at around $8.9 billion at the higher end of the revised target range.
The company's stock structure includes Class A and B shares, with Class B shares holding ten times the voting rights of Class A shares. Insiders currently hold these Class B shares which represent over 99% of total voting interest. Following the offering, e-commerce software firm Shopify (NYSE:SHOP) will maintain an 11.5% voting interest in Klaviyo, translating to a stake worth about $840 million at the top of the revised price range. Andrew Bialecki, CEO and co-founder of Klaviyo, will control 39% of the company's voting rights post-offering.
A significant proportion of Klaviyo's revenue, over 80%, comes from Shopify customers, as indicated by Roth MKM analyst Rohit Mulkarni. The firm has shown remarkable growth, reporting revenues of $246.6 million for the first half of 2022, a 64% increase from the same period in the previous year. Klaviyo's full-year revenue for 2022 was $344.7 million, marking a 67% increase from 2021. The company also achieved profitability this year with a net income of $15.2 million for the first half and a trailing 12-month revenue of $585.1 million, up by 56.5%.
Institutional investors BlackRock (NYSE:BLK) and AllianceBernstein (NYSE:AB) have committed to purchasing up to $100 million of Klaviyo's stock at the IPO price, as per the filing details. The underwriting group for Klaviyo's deal includes Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), and Citigroup (NYSE:C).
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