DigitalOcean has filed to go public on the New York Stock Exchange under the ticker symbol “DOCN.” DigitalOcean joins Coinbase in a list of tech companies listed this wee
DigitalOcean, a cloud service provider and hosting company, has filed a registration statement for a proposed Initial Public Offering (IPO). The tech company joins a long list of tech companies looking to capitalize on the current stock frenzy. More specifically, DigitalOcean is the second high-profile tech company to push for listing after Coinbase. The crypto exchange on Thursday opened its books to the public.
There is also a huge similarity between the two companies looking at their 2020 financials. Coinbase disclosed that it recorded a profit of $322 million on revenues in excess of $1.2 billion. DigitalOcean hit $300 million in revenue in 2020. Both of these are impressive given how many companies struggled to record profits since the pandemic struck.
Though the DigitalOcean has every intention to go public and is taking a straightforward approach. However, the number of shares and price have not yet been disclosed. Furthermore, there are no assurances as to the date their offers will end or the terms. In its filing, the company noted:
“DigitalOcean intends to list its common stock under the ticker symbol ‘DOCN’ on the New York Stock Exchange. The number of shares to be offered and the price range for the proposed offering have not yet been determined. The offering is subject to market conditions, and there can be no assurance as to whether, or when, the offering may be completed or as to the actual size or terms of the offering,”
The digital company in 2020 raised $50 million with a valuation of $1.5B. Now, it is seeking to raise an additional $100 million.
Is It The Right Time for DigitalOcean to Go for IPO?
TechCrunch reports that DigitalOcean’s financial results do not tell the whole story. While the company took $300M in profit, it also saw a huge layoff early in the year as well as a $100M debt raise. This is however unlikely to sway interested investors who will only be interested in the profit recorded at the end of the year.
The listing comes at a time when companies are partnering with special purpose acquisition companies (SPACs). These are shell companies that help raise money before a listing and guarantee a valuation. They have further been a sure way to get positive hype around the stock in its first few days of trading.
DigitalOcean and Coinbase are therefore listing in an ideal time that is at the very least guaranteed to see them soar in the short term. in the long term, performance will likely be influenced by the wider market trend.
Kiguru is a fine writer with a preference for innovation, finance, and the convergence of the two. A firm adherent to the groundbreaking capability of cryptographic forms of money and the blockchain. When not in his office, he is tuned in to Nas, Eminem, and The Beatles.