Illustration: Sarah Grillo/Axios

Chewy is going public this week, carrying a valuation of about $7 billion, roughly twice what the company sold for in 2017. It too has a special class of shares. Its largest shareholder, BC Partners, will control 98.8% of the votes after the offering is over.

Between the lines: Chewy has never turned a profit, and it burned through $63.3 million of cash in the quarter ending on May 5. At that rate, the $101 million it plans to raise in the IPO will last just 21 weeks.

  • After 13 weeks, BC Partners will be free to sell the rest of its Chewy shares, after unloading shares worth $650 million at the IPO. The private equity shop could reduce its stake to as low as 10% while still retaining control of the company.
  • Chewy's super-voting shares aren't held by visionary founders with a long-term time horizon. Rather, they're held by a private-equity shop with a fiduciary obligation to liquidate its holdings and return the maximum amount of cash to its investors.

The bottom line: Chewy's parent, PetSmart, has more than $8 billion of debt and is under enormous pressure to pay it down. It's therefore reasonable to expect large future sales of Chewy stock. What's less clear is how Chewy can continue to invest in growth without raising substantial debt of its own. Per Chewy's revised S-1, the company has already lined up a $300 million credit line.

Flashback: The degraded stock market through the eyes of a pet food IPO

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Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 7 a.m. ET: 19,655,445 — Total deaths: 727,353 — Total recoveries — 11,950,845Map.
  2. U.S.: Total confirmed cases as of 7 a.m. ET: 4,998,802 — Total deaths: 162,425 — Total recoveries: 1,643,118 — Total tests: 61,080,587Map.
  3. Politics: Trump signs 4 executive actions on coronavirus aid — Democrats, and some Republicans, criticize the move.
  4. Public health: Fauci says chances are "not great" that COVID-19 vaccine will be 98% effective — 1 in 3 Americans would decline COVID-19 vaccine.
  5. Science: Indoor air is the next coronavirus frontline.
  6. Schools: How back-to-school is playing out in the South as coronavirus rages on — Princeton, Johns Hopkins, Howard to hold fall classes online.

Elevator anxiety will stifle reopenings

Illustration: Aïda Amer/Axios

Will you step back into an elevator any time soon?

Why it matters: Tens of billions of dollars — and the future of cities around the country — rest on the answer to that question. So long as workers remain unwilling to take elevators, hundreds of billions of dollars' worth of office real estate will continue to go largely unused.

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Brazil coronavirus death toll tops 100,000 and case numbers surpass 3 million

Brazilian President Jair Bolsonaro posted a photo of himself to Facebook congratulating his soccer team, Palmeiras, for winning the state title Saturday, moments after the health ministry confirmed the national COVID-19 death toll had surpassed 100,000.

Why it matters: Brazil is only the second country to confirm more than 100,000 deaths from the coronavirus. On Sunday morning, it became the second country to surpass 3 million cases, per Johns Hopkins. Only the U.S. has reported more. Bolsonaro has yet to address the milestones. He has previously tested positive for COVID-19 three times, but he's downplayed the impact of the virus, which has crippled Brazil's economy.

Editor's note: This article has been updated with the latest coronavirus case numbers and more context.