DoorDash‘s upcoming initial public offering puts the company on track to hit Wall Street as one of the highest-valued venture-backed companies, second only to Uber, to complete an IPO in the past five years.
On Friday, DoorDash raised the expected price range of its shares to between $90 and $95 apiece, implying a fully diluted market value of more than $37 billion if it prices at the midpoint of that range. That valuation would be the second-highest since 2016 among US VC-backed companies, trailing Uber’s $75.7 billion market value on its debut in May 2019, according to PitchBook data.
DoorDash previously expected to sell 33 million shares at $75 to $85 apiece. The new target valuation would mark a roughly 131% jump from the $16 billion valuation DoorDash received in June, according to PitchBook data.
At the midpoint price, DoorDash would surpass the estimated $33.2 billion valuation that cloud data specialist Snowflake held at the time of its IPO in September. And it could also top Airbnb, which has set a price range that would put its valuation in the neighborhood of $32 billion. However, that is still subject to change and the company is poised to boost the price range of its shares in an upward revision that would lift its valuation as high as $42 billion, The Wall Street Journal reported on Sunday evening.
SoftBank would own a stake worth $5.8 billion in DoorDash at the offering’s midpoint price of $92.50 per share. The Japanese investor is DoorDash’s largest outside shareholder and was also Uber’s biggest pre-IPO backer.
Demand for food delivery has shot up during the pandemic, and DoorDash has emerged as the market leader in the US, according to consumer analytics provider Second Measure. The company’s order volume more than doubled from Q1 2020 to Q3, when it fulfilled 236 million orders.
Year-over-year revenue more than tripled in the first three quarters of the year to $1.9 billion. DoorDash recorded its first quarterly profit of $23 million in Q2.
Several other companies have joined DoorDash and Airbnb in a December rush to go public including online gaming provider Roblox, buy-now, pay-later startup Affirm and ecommerce shopping specialist Wish.