Casper to Price IPO Shares at $12, Bottom of Lower Range
(Bloomberg) -- Bed-in-a-box seller Casper Sleep Inc. raised $100 million in an initial public offering, pricing its shares at the bottom of a reduced range.
Casper, which boasted a valuation of $1.1 billion in a private funding round last year, is valued in Wednesday’s IPO at less than half of that.
The online retailer sold 8.35 million shares Wednesday for $12 each, according to a statement. The listing gives the company a value of $476 million based on the outstanding shares listed in its filings. Earlier in the day, it cut its price target to $12 to $13 a share, down from $17 to $19.
The IPO shows investors have grown skeptical of money-losing unicorns -- startups whose private valuations reached $1 billion or more. The listing follows landmark but largely disappointing performances last year by consumer-oriented companies including Uber Technologies Inc. and its smaller rival Lyft Inc., as well as SmileDirectClub Inc. and Peloton Interactive Inc.
Casper priced its shares on the same day as PPD Inc., a biotechnology and drug research services firm that raised $1.62 billion, pricing its shares at the top of its target for the offering. In the past year, such business-to-business firms, especially software makers, have tended to fare better in their IPOs and afterward than consumer-focused companies.
New York-based Casper, founded in 2014, became one of the leading brands thanks to its pioneering status in the niche and savvy marketing. Since then, a slew of competitors have emerged in the U.S. and abroad. From 2016 to September 2019, Casper spent $422.8 million on marketing, according to an earlier filing.
Casper had 60 stores in the U.S. and Canada as of Sept. 30. Its sales increased to $312 million for the nine months ended Sept. 30, a 20% gain from the same period in 2018. Its net loss widened to $67 million from $64 million during the same period in 2018.
The company’s backers include Target Corp. and Dani Reiss, the chief executive officer of Canada Goose Holdings Inc.
The offering was led by Morgan Stanley, Goldman Sachs Group Inc. and Jefferies Financial Group Inc. The company’s shares are expected to begin trading Thursday on the New York Stock Exchange under the symbol CSPR.
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