Gopuff Starting Preparations for IPO in Second-Half of 2022

(Bloomberg) -- Delivery startup Gopuff is in discussions with investment banks about an initial public offering to take place as soon as the second half of next year, according to people familiar with the matter.

The SoftBank-backed startup could appoint banks for a stock listing in the first half of the year, said the people, who asked not to be identified because the discussions are private. Gopuff’s plans aren’t finalized and could change.

On Thursday, Gopuff took a big step toward its listing by issuing a $1.5 billion pre-IPO convertible note led by Guggenheim Partners, which was already an investor, the people added. The note will convert to shares at either the IPO price or at a maximum valuation of $40 billion, the people said.

A spokeswoman for Gopuff declined to comment, and a representative for Guggenheim couldn’t be reached for comment. The convertible financing was reported earlier Thursday by Axios.

Here’s how the note works: If Gopuff’s market capitalization in the IPO eclipses $40 billion, Guggenheim and other holders of the debt can convert their shares at the lower $40 billion value.

Convertible notes are a popular way for big startups to issue debt and secure financing ahead of a stock market listing. Airbnb Inc. did a similar transaction several months ahead of its IPO a year ago.

Founded in 2013 by college students in Philadelphia who wanted to make it easier to get convenience items delivered, Gopuff operates across the U.S. and parts of Europe. The company delivers thousands of products, from ice cream to cleaning sprays, for a flat fee. It’s backed by firms including Accel, Blackstone Inc., Baillie Gifford, D1 Capital Partners and SoftBank Group Corp.’s Vision Fund.

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