Aug 30, 2021 - Economy & Business

Why Rivian's IPO is worth watching

Rivian R1T electric truck.

Rivian R1T electric truck. Photo: Rivian

Rivian, the well-financed electric vehicle startup about to start delivering its pickup truck, says it has filed plans to go public with securities regulators.

The big picture: The company is quite well-capitalized. Rivian's financial backers include Ford, Amazon and BlackRock.

  • Rivian's recent $2.5 billion funding round brings the total amount raised above $10 billion.
  • It's also breaking from the pack of EV startups going public with apparent plans to eschew listing via merger with a special purpose acquisition company, the route many others are taking.
  • Bloomberg reported that Rivian is hoping to do an IPO around the Thanksgiving timeframe and hopes for an $80 billion valuation, while the NYT says it's aiming for $70 billion.
  • Those numbers are eye-popping. Consider that Ford's market capitalization is currently $52 billion.

The intrigue: The EV market is getting crowded even as EVs remain a very small slice of auto sales. But Rivian, flush with cash, has reason for confidence, analysts said in response to Friday's announcement.

  • "[W]e believe Rivian is an ideal position to go public as investor enthusiasm for EVs is high," PitchBook analyst Asad Hussain said.
  • "Similar to Tesla, Rivian’s premium market valuation reflects its ownership of the entire value chain, including direct-to-consumer sales, charging networks, and commercial vehicle business," Hussain said in a note.

Catch up fast: Rivian will begin deliveries of its pickup truck next month, with plans to start delivering its SUV this fall.

  • The Michigan-based startup also has a large deal with Amazon to build up to 100,000 electric delivery vehicles this decade.

Go deeper: The EV revolution will hit speed bumps

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