A few months back, robotic process automation (RPA) unicorn UiPath raised a huge $750 million round at a valuation of around $35 billion. The capital came ahead of the company’s expected IPO, so its then-new valuation helped provide a measuring stick for where its eventual flotation could price.
In an S-1/A filing, UiPath disclosed that it expects its IPO to price between $43 and $50 per share. Using a simple share count of 516,545,035, the company would be worth $22.2 billion to $25.8 billion at the lower and upper extremes of its expected price interval. Neither of those numbers is close to what it was worth, in theory, just a few months ago.
According to IPO watching group Renaissance Capital, UiPath is worth up to $26.0 billion on a fully diluted basis. That’s not much more than its simple valuation.
For UiPath, its initial IPO price interval is a disappointment, though the company could see an upward revision in its valuation before it does sell shares and begin to trade. But more to the point, the company’s private-market valuation bump followed by a quick public-market correction stands out as a counter-example to something that we’ve seen so frequently in recent months.
Is UiPath’s first IPO price interval another indicator that the IPO market is cooling?
If you think back to the end of 2020, Roblox decided to cancel its IPO and pursue a direct listing instead. Why? Because a few companies like Airbnb had gone public at what appeared to be strong valuation marks only to see their values rocket once they began to trade. So, Roblox decided to raise a huge amount of private capital, and then direct list.