The IPO Buzz: BIRD, NRDS & Blockbusters

The BIRD, BIRD, BIRD – the BIRD is the word. AllBirds, Inc. (BIRD proposed), known for its “Wool Runner” shoes, is perched atop November’s IPO Calendar. Next up: NRDS. Yes, NerdWallet (NRDS proposed), a personal finance app that’s popular with the early 20-somethings in Gen Z, is also set to go public this week. (This column was updated again Thursday morning with the news on NerdWallet’s debut on the NASDAQ. The column was previously updated with NerdWallet’s IPO pricing details and news earlier in the week on the Allbirds IPO pricing and its trading debut on the NASDAQ.)

But the  biggest buzz on Monday came from two blockbuster deals at the SEC’s filing window – electric truck maker Rivian Automotive Inc. (RIVN proposed) set terms for its $8 billion IPO, expected next week, and Brazilian digital banking company Nu Holdings (NU proposed) set terms for its $3 billion IPO, pricing date to be determined.

Rivian will be the biggest IPO of 2021. The electric pickup truck maker – backed by Amazon – plans an IPO of 135 million shares at $57 to $62 each, according to its S-1/A filing dated Nov. 1, 2021. The IPO would raise $8,032.5 million – or $8.03 billion – if priced at the $59.50 mid-point.

At the $62 high end of its IPO price range, Rivian would have a market cap just above $60 billion, The Wall Street Journal was first to report. If the IPO is priced at the $59.50 mid-point of its $57-to-$62 range, Rivian would have a market cap of almost $52 billion. Either way, that’s serious money.  Rivian’s IPO is set for pricing next week. The stock is expected to start trading on Nov. 10 on the NASDAQ.

“Get ready for Rivian,” a veteran IPO trader says.

Morgan Stanley, Goldman Sachs, J.P. Morgan, Barclays, Deutsche Bank Securities, Allen & Co., BofA Securities, Mizuho Securities, Wells Fargo Securities, Nomura, Piper Sandler, RBC Capital Markets, Baird and Wedbush Securities are the joint book-runners and lead managers on the Rivian IPO.

Nu Holdings, the parent of Brazilian digital bank Nubank, plans an IPO of 289.2 million shares, at $10 to $11 each, according to its F-1/A filing dated Nov. 1, 2021. The IPO would raise $3,036.6 million – or $3.04 billion – if priced at the $10.50 mid-point.

Warren Buffett’s Berkshire Hathaway invested $500 million in Nu Holdings in a private funding round in June, CNBC reported. Nu Holdings landed on CNBC’s Disruptor 50 list in May 2021.

The market cap for Nu Holdings would be about $50 billion, if the IPO is priced at the $10.50 mid-point. No IPO pricing date has been scheduled yet for the Nu Holdings deal. Nu Holdings plans to dual list its stock in the U.S. and Brazil.

Morgan Stanley, Goldman Sachs, Citigroup, Nu Invest, Allen & Co., HSBC and UBS Investment Bank are the joint book-runners on the Nu Holdings IPO.

Allbirds Soars

Bankers expect to raise about $3 billion this week from 16 deals – 12 IPOs, two uplift offerings and two SPACs (special-purpose acquisition companies) so far. Let’s take a look at the two marquee names on this week’s IPO Calendar.

Allbirds, Inc. (BIRD proposed) is one of the best-known names on this week’s IPO Calendar. The company’s “Wool Runner” shoes have a cult following in Silicon Valley and beyond.  About 89 percent of Allbirds shoes are sold online – via the company’s localized multilingual digital platform, the prospectus says.

The Allbirds IPO was upsized at pricing on Tuesday evening (Nov. 2, 2021) to 20.19 million shares – up from 19.23 million shares – and priced at $15 – $1 above its $12-to-$14 price range – to raise $302.85 million.

Allbirds opened at $21.21 – up 41.4 percent from its IPO price at $15 – and climbed to an intraday high at $32.44 – scoring a moonshot on its first day – and then glided back to around $28.80 – up about 93 percent – by mid-afternoon on its first day of trading on the NASDAQ. Allbirds closed at $28.89 – up 92.6 percent on its opening day on the NASDAQ.

Morgan Stanley, J.P. Morgan, BofA Securities, Baird, William Blair, Piper Sandler, Cowen, Guggenheim Securities, KeyBanc Capital Markets and Stifel were the joint book-runners for the Allbirds IPO.

Up to 6 percent of the Allbirds stock was offered to retail investors – at the company’s request – through Morgan Stanley Wealth Management, Robinhood Financial, Futu and ClickIPO Securities, the prospectus says. Robinhood, Futu and ClickIPO will be selling group members.

AllBirds had a net loss of $25.9 million on revenues of $219.3 million for the last 12 months, according to the prospectus.

Nerds and Money

NerdWallet Inc. (NRDS proposed) is the other high-profile name set to go public this week. The company’s digital platform and app caters to consumers – typically ranging in age from 18 to 35 – by providing information to help them do “comparison shopping” for credit cards, student loans, insurance and mortgages. The company also serves small to mid-sized businesses.

The NerdWallet IPO was priced on Wednesday evening (Nov. 3, 2021) at $18 – the mid-point of its $17-to-$19 range – on 7.25 million shares, the same number of shares in the prospectus.

NerdWallet’s stock jumped to $23.50 when it started trading Thursday on the NASDAQ – up 30.6 percent from its $18 IPO price. NerdWallet extended its opening gain by late morning to trade at $26.68 – up 48.2 percent from its IPO price. 

Morgan Stanley, KeyBanc Capital Markets, BofA Securities,  Barclays and Citigroup were the joint book-runners of the NerdWallet IPO.

Tim Chen, a co-founder and the CEO of NerdWallet, owns shares with most of the voting power – and that will still be true after the IPO.

A Stanford graduate, Chen teamed up with Jason Gibson, one of his high school friends, to start NerdWallet in 2009 – after he lost his hedge fund job during the financial crisis of 2008. Chen says he got the idea for NerdWallet after his sister asked him for help in selecting the right credit card for her. He couldn’t find anything but marketing material online. So he did his own digging and organized his research results on an Excel spreadsheet – a nerdy thing to do, as he tells it.

By 2015, NerdWallet had a company cafeteria that provided free meals and a company bar that served signature cocktails – “Revenge of the Nerds” and the “Nerd-fashioned,” NBC reported. (Pop culture fans, this link to Siskel & Ebert’s review of the 1984 movie –  “Revenge of the Nerds”is for you.)

NerdWallet has revenue growth, but it swung from a profit to a loss in the nine-month period ending Sept. 30, 2021, compared with the year-ago period, according to the prospectus.

For the last 12 months, NerdWallet had a net loss of $38 million on revenues of $336.8 million.

Second Week of November

Five IPOs are scheduled for pricing in the week of Nov. 8, 2021 But all eyes will be on the supersized Rivian deal.

Stay tuned.

For more information, please check the IPO Calendar and click on a company’s name, which will take you to the IPO Profile and a link to the prospectus.)

(Never trade on proposed symbols. You might wind up owning something on the OTC Bulletin Board.)

Disclosure: Nobody on the staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The staff does not issue advice, recommendations or opinions.

Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums), is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.