IPO Market Booming
DigitalOcean said it is expecting to secure up to $775.5 million through an IPO of 16.5 million shares, priced in a range between $44 and $47 per share, according to a regulatory filing.
The move comes during a period when a number of companies switch to cloud computing as people are still working from home due to the COVID-19 pandemic.
The cloud business provides a platform and other solutions to developers, startup companies, and small-and-medium-sized businesses (SMBs). The cloud computing firm currently has more than 570,000 customers across over 185 countries, including companies like RouteTrust, Cloudways, and Centra.
“Our core customer base consists of individual developers, early-stage start-ups, and small-to-medium size businesses, many of which plan for high growth. We expect that our path to growth will, in part, rely on scaling our platform to meet the needs of such customers as they increase usage of our platform,” the company said.
DigitalOcean competes in the market controlled by giants such as Amazon Web Services, Microsoft Corp, Oracle Corp, and IBM Corp. The company’s upcoming IPO underlines the current investors’ interest in tech companies, which have recorded a massive surge in demand during the coronavirus pandemic.
The company filed for a $100 million IPO back in February. The New York City-based cloud business had raised $50 million in a Series C funding round in May last year, headed by Access Industries. Other investors that backed DigitalOcean in that round included Fortress Investment Group and Andreessen Horowitz.
The cloud-computing company reported around $318.4 million in revenue last year, 25% more than the $254.8 million in revenue reported in 2019. It also reported a $43.6 million loss in 2020, slightly bigger than the $40.4 million the business posted a year earlier.
DigitalOcean will trade on the New York Stock Exchange under the ticker symbol “DOCN.” The lead underwriters of the IPO include Morgan Stanley, Goldman Sachs, and JP Morgan.
Cloud-computing company DigitalOcean Holdings said Monday it expects to reach a business valuation of around $5 billion in its upcoming IPO. The company added it hopes to raise up to $775.5 million through an offering of 16.5 million shares, priced between $44 and $47 per share.
About the Author
Mariliana has an MSC in Consumer Analytics and Business Strategy. She has a special interest in fast-moving industries and Big Data.