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No stops on the IPO express: Unity Software seeks to raise $1B on $11B valuation
Software platform startup Unity Software Inc. is planning to raise as much as $1.05 billion in an initial public offering that will value the company at $11.06 billion.
The IPO was announced Aug. 24, with further details coming to light today via a regulatory filing with the U.S. Securities and Exchange Commission. Along with saying that it intended to offer 25 million shares in its IPO at between $34 to $42 to per share, Unity also disclosed that it had 1.5 million monthly active creators in more than 190 countries.
Some 8,000 games and applications are created each month using Unity’s platform, with creators spending on average 5.1 hours per day using the platform. More than half of the top 1,000 mobile games are said to be built with Unity.
Typically for a tech company going public these days, Unity is not profitable. It booked a net loss of $163.2 in 2019, up from a net loss of $131.6 million in 2018. Revenue last year rose 42%, to $541.8 million, and it’s on track to reach $640 million in 2020.
Founded in 2004, Unity is best known as a platform used for the development of games but is also now used in the development of virtual and augmented reality services. Claimed to be the world’s leading real-time 3D development platform, the Unity Engine allows developers to create, operate and make money from experiences for the “real-time world.”
One recent example of a nongaming use is Toyota Motor Co. using Unity in combination with Microsoft HoloLens 2 to develop applications tailored to its needs. Some of those uses include conducting training sessions in VR, creating realistic car configurators for its Lexus division and condensing inspection workflows from days to hours with HoloLens.
Coming into its IPO, Unity had raised $1.3 billion over eight rounds. According to the company’s regulatory filing, Sequoia Capital holds a 24.1% stake and Silver Lake holds an 18.2% stake. Other investors include D1 Capital Partners, Light Street Capital, Altimeter Capital and DFJ Growth.
Despite concerns that the COVID-19 recession could put a dent in tech floats this year, the IPO express has continued at full speed. Unity isn’t alone is the queue to go public before the end of the year, with Airbnb Inc., Palantir Technologies Inc., Asana Inc. and DoorDash Inc. all expected to float in the coming months.
That said, Unity may beat the rush as MarketWatch has the Unity IPO scheduled for next week along with Snowflake Computing Inc. and Sumo Logic Inc.
Image: Unity
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