- Mike Blake/Reuters
- Casper on Wednesday priced its IPO at $12 a share.
- That’s at the low end of the range it had already lowered earlier in the day.
- The price gives the company a market capitalization of around $490 million, or less than half the valuation venture investors gave it in its last private funding round a year ago.
- The company is only the latest unicorn, or startup valued at $1 billion or more, to wither in the public market spotlight.
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Investors, it seems, weren’t super-thrilled about Casper.
The online mattress vendor on Wednesday priced its initial public offering at $12 a share, a source familiar with the deal told Business Insider. That was at the bottom of the pricing range it had already lowered earlier in the day. CNBC previously reported the pricing news.
At that price, the company will raise as much as $115.2 million in the offering, before fees, which is far less than it was previously expecting. As recently as last month, the company expected to raise as much as $182.4 million, before fees.
The move will give the company a market capitalization of around $490 million when it begins trading on the New York Stock Exchange under the CSPR ticker on Thursday. That’s less than half the $1.1 billion valuation private investors conferred on the company a year ago in its last venture funding round.
Casper had already indicated that public investors were more skeptical of its money-losing business than its venture backers were. The company initially said it expected to price its IPO at between $17 and $19 a share. Even it had priced its offering at the top of that range, Casper would have gone public with a market cap of less than $800 million – below its private market valuation.
On Wednesday, in an updated filing with the Securities and Exchange Commission, the company reduced that range, saying it now expected to price its offering between $12 and $13 per share.
Casper is one of more than 400 so-called unicorns – private, venture-backed companies with a valuation of more than $1 billion. It’s only the latest to run into problems with public investors.
Last year, Uber, Lyft, and Slack all saw their stock prices plunge after they went public. And last fall, WeWork had to withdraw its attempted IPO altogether in the face of stiff pushback from investors over its massive losses and questionable corporate governance.
Like many other unicorns, Casper has been posting large and ongoing losses despite many years of operations. Like WeWork and Peloton, it also tried in its IPO documents to portray itself as a tech company, seemingly in an effort to convince investors that its shares were worth a tech-like premium.
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- Read more about Casper’s public offering:
- Casper Sleep slashes the price range for its planned IPO
- Casper will raise up to $182 million in its IPO – valuing the company below its March 2018 quote
- Buzzy mattress maker Casper is pitching itself as a tech company, just like WeWork did. Here why business experts are dubious.
- Casper, the buzzy mattress seller adored by millennials, has a costly returns problem that could be a nightmare for its IPO