Coinbase’s wild debut
April 15, 2021
In what may well be the hottest IPO of 2021 yet, cryptocurrency exchange Coinbase barreled through its last private-market valuation.
You’ll see a lot of numbers bandied about in reports. When it comes to valuations, some are using a fully-diluted figure, which includes shares set aside for stock incentive plans or shares that could become part of the pool via the exercise of options or warrants. The $100 billion plus valuation ($112 billion at the stock’s $430 or so peak Wednesday) that has made its rounds is derived from this calculation. On a shares outstanding basis, which strictly accounts for current shares, Coinbase has yet to actually hit that tag on the public markets.
The other reason for the plethora of numbers out there is less this valuation methodology, and more the wild swings in Coinbase’s stock itself over the course of the day: On a purely shares outstanding basis, the valuation soared as high as $85.5 billion and as low as $61.7 billion, before settling around $65 billion at the end of trading. The startup posted a runaway first quarter but has also fanned concerns over whether it can maintain such a lofty valuation. And I suspect that volatility could be a feature of the stock in coming quarters.
Still, the debut marks a major win for its shareholders even at its lowest trading price Wednesday. Coinbase CEO Brian Armstrong is a billionaire several times over, with his stake worth about $13.2 billion as of this morning. Initialized Capital, an early investor, turned its $300,000 stake into one worth about $2.4 billion. Rapper Nas also profited handsomely. That’s not to mention the returns of major shareholders such as Andreessen Horowitz, with a stake worth about $9.8 billion as of this morning, or Tiger Global, which has a stake valued at around $4.7 billion.
SUPREME: Streetwear brand Supreme has become a runaway success with its exclusive merchandise drops. In November, VF announced plans to acquire the company for $2.1 billion. And the question became, could the brand survive under its new owners? My colleague Phil Wahba dives into why the deal could actually be a good one.
“To get a sense of how VF could steer Supreme, it’s instructive to look at how it has managed Vans—another streetwear upstart that is now a $4-billion-a-year global brand,” he writes. Read more.
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- Outschool, a San Francisco-based marketplace for k-12 education, raised $75 million in Series C funding, valuing it at $1.3 billion. Tiger Global Management and Coatue led the round and were joined by investors including Lightspeed Ventures, Union Square Ventures, and Reach Capital.
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- Tomorrow Health, a New York-based platform for home healthcare, raised $25 million in Series A funding. Andreessen Horowitz led the round and was joined by investors including Obvious Ventures and BoxGroup.
- sunday, an Atlanta-based app for paying in restaurants, raised $24 million in seed funding. Coatue and New Wave led the round.
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