Venture Capital: Palantir, Last Valued at $20B, May Finally Bite The IPO Bullet

June 12, 2020 | News, Venture Capital

Palantir, the ultra-low-profile, big data firm co-founded by Peter Thiel (pictured above) is said to be prepping for an IPO, come September.

Palantir Technologies Inc., one of the venture world’s most anticipated IPOs, may soon hit the markets, according to a report by Reuters.

The company processes big data for the U.S. government, including for some of its highly sensitive projects. Its clients also include global banks as well as the CIA. Reportedly, its technology was instrumental in locating Osama bin Laden.

Reuters’ sources said the company was working towards a September time table, market conditions permitting.

U.S. IPOs are striking it rich

Shares of Vroom (NASDAQ: VRM), an online used car seller, opened for trading on Tuesday and closed more than 117% higher than its IPO price of $22 per share.

Other IPOs that listed during this month also had a field day. Shares of ZoomInfo Technologies (NASDAQ: ZI), priced at $21 per share in the IPO, closed Thursday at $49.50.

Warner Music (NASDAQ: WMG) closed Thursday at $29.99 after it priced its IPO at $25.

Ebullient conditions in the IPO market, coupled with the economic uncertainties from the coronavirus pandemic, have made hitherto reluctant founders more amenable to the idea of taking their start-ups public.

This may explain why the highly secretive Palantir Technologies is mulling an IPO at this time. Once listed, the company would be subject to more public scrutiny from its investors.

However, it is not yet clear whether the company would opt for a traditional IPO or a direct listing route. According to sources quoted by Reuters, Morgan Stanley (NYSE: MS) is expected to play a leading role in the listing, though the company has not yet hired any investment banks.

Palantir valuations are down

Palantir Technologies, a 17-year-old company, had its last fundraising in 2015 at a valuation of $20 billion.

However, according to Business Insider, secondary shares of the company were available at a valuation of between $ 8 billion and $ 12 billion earlier this year. In February, secondary share marketplace EquityZen offered Palantir shares for just $4.85, implying a valuation of $8.9 billion.

Further, Palantir recently lowered its strike price for employees’ options from $6.03 to $4.72 per share.

Fujitsu invests $50 million in Palantir Technologies

On Wednesday, Fujitsu Ltd (TYO: 6702) announced a strategic alliance with Palantir Technologies to bring world-class technology to the Japanese market and accelerate Japan’s Digital Transformation (DX) initiatives.

Fujitsu also invested US$50 million into Palantir Technologies Inc. as a strategic investment.

Related Story:  Activist Investors Pressure Palantir on Human Rights

Featured Image courtesy Wikimedia: Peter Thiel, Co-founder and Chairman, Palantir

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