Amplitude valued at $5 bln after shares jump in Nasdaq debut (updated)

Amplitude

28/09/2021 19:30

(Updates with interview, background)
    By Krystal Hu and Echo Wang
    Sept 28 (Reuters) - Shares of Amplitude Inc  AMPL.O  opened
nearly 43% above their reference price in their Nasdaq debut on
Tuesday, notching up a valuation of about $5 billion for the
benchmark-backed analytics company.  
    San Francisco-based Amplitude, which confidentially filed
for a direct listing in July, was valued at $4 billion after
raising $150 million from Sequoia Capital and Singapore's
sovereign wealth fund GIC in June. 
    Stock of the company opened at $50 per share, up from the
reference price of $35 per share. 
    Amplitude provides data analytics tools that enable
companies to optimize their products. Its customers include
NBCUniversal, PayPal Holdings Ltd  PYPL.O , Peloton Interactive
Inc  PTON.O  and Instacart.
    It has benefited from the accelerated digital transformation
during the pandemic, as companies seek to optimize customer
experience online by using analytical tools.
    It reported $72 million in revenue for the first half of the
year, a 56% jump year over year, compared with a loss of $16.5
million. 
    The seven-year-old company chose to go public through a
direct listing, an alternative to an initial public offering
that has gain traction among companies after Spotify Technology
SA  SPOT.N  pioneered it in 2018. 
    In a direct listing, companies are allowed to list on the
stock market without selling shares. They set a reference price
but no shares are sold in advance at that price, unlike in an
IPO where shares are sold to institutional investors at a set
price.
    "Traditional IPOs severely under-price companies," said
Spenser Skates, Amplitude Co-founder and CEO, who has been a
proponent of direct listing. "There's a great window for
companies to go out this year. This is about as fast as we could
do it." 
    Investors see Amplitude's strong debut as a catalyst for
other tech companies who are exploring ways to go public. 
    "This is a watershed moment for direct listings. I think the
entire market is looking at Amplitude to see how it does,
because it looks like many of the software companies that will
go public in the next 12 to 18 months in terms of size, growth
and not being well-known household names," said Neeraj Agrawal,
partner at Battery Ventures, an early investor in Amplitude. 
    Morgan Stanley advised Amplitude on the direct listing. 

 (Reporting by Krystal Hu and Echo Wang in New York and Niket
Nishant in Bengaluru; Editing by Shinjini Ganguli and Mark
Porter)
 ((Niket.Nishant@thomsonreuters.com;))