Vahe Kuzoyan, left, and Ara Mahdessian, the founders of ServiceTitan.
ServiceTitan
ServiceTitan, a provider of cloud software to contractors, priced its IPO at $71 a share on Wednesday, above the expected range.
The company is set to debut on the Nasdaq on Thursday under ticker symbol “TTAN.” ServiceTitan previously raised its price range to between $65 and $67.
ServiceTitan sold 8.8 million shares in the offering, which would amount to a raise of almost $625 million. At the IPO price, ServiceTitan is worth about $6.3 billion.
Technology IPOs have been sparse since late 2021, when inflation and rising interest rates pushed investors out of riskier assets. Cloud software stocks quickly went out of favor after remote work during the pandemic had accelerated their growth.
In March of this year, social network Reddit went public, followed by data management company Rubrik the following month. In September, less than two weeks after the Federal Reserve lowered its benchmark rate for the first time since 2020, chipmaker Cerebras filed for an IPO. However, the company has yet to debut on the market.
ServiceTitan, based in Glendale, California, filed to go public on Nov. 18. The company has said some proceeds would go toward redeeming all outstanding shares of its non-convertible preferred stock. It had issued that stock in 2022 to repay loans to finance the $577 million acquisition of pest control software provider FieldRoutes.
While raising money in 2022, ServiceTitan agreed to “compounding ratchet” terms that encourage the company to quickly go public and prevent unnecessary dilution, according to an analysis from venture firm Meritech Capital.
Bessemer Venture Partners, TPG and Iconiq Growth are among the company’s top shareholders, alongside founders Vahe Kuzoyan and Ara Mahdessian.
Mahdessian’s father had a contracting business, and Kuzoyan’s father dealt in plumbing, according to the Los Angeles Times. The founders said in a pre-recorded IPO roadshow that they saw technology as a way to modernize their family businesses. Their software can help with marketing, sales, scheduling and customer service.
ServiceTitan’s preliminary results for the October quarter show a net loss of about $47 million on $198.5 million in revenue. That suggests approximately 24% year-over-year revenue growth, the highest rate since mid-2023. But the company’s net loss widened from around $40 million in the October quarter last year.
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