Speaking of Mega-Rounds

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Emailed on February 8, 2019 in The Friday Forward

Here are a few big money announcements from this week:

Slack announced that it has filed a confidential registration statement with the SEC for what is expected to be a direct listing.
This is particularly interesting for three reasons:

  1. Slack will be the first enterprise software company to attempt a direct listing (foregoing the Wall Street road show) since Spotify successfully IPO'd through direct listing last year. Spotify, as a consumer company, made waves in the IPO market with the decision to direct list, but an enterprise software company successfully listing this way will be a major disruption to the model.

  2. Slack has $1 billion in the bank, so it doesn't really need the IPO proceeds. 

  3. According to Dan Primack at Axios, "Don’t be stunned if Slack gets acquired before it lists, particularly given that both Google and Microsoft (or Amazon?) could easily afford the $20 billion that a source says it would take."

Reddit  is raising $150 million to $300 million near a $3 billion valuation
The forthcoming Series D round is said to be led by Chinese tech giant Tencent at a $2.7 billion pre-money valuation.

Sean SteigerwaldComment