Pinterest is actively preparing for an IPO that could come as soon as April, according to people familiar with the company’s plans, the latest in a line of tech companies ramping up plans to go public.
Pinterest has told bankers it could choose its slate of underwriters to run the initial-public-offering process as soon as January, these people said. It could achieve a valuation in the public market at or in excess of $12 billion—the level at which it most recently raised funding, some of the people said. Valuations can change until a company prices its initial public offering.
In September, Pinterest surpassed more than 250 million monthly active users, who visit the site to browse through billions of images on topics ranging from living-room furniture to dinner recipes and tattoos. The company generates revenue from ads scattered across its site and is poised to generate revenue in excess of $700 million this year, up 50% from the prior year, according to a person familiar with the matter.
Should Pinterest move forward with an IPO in the first half of 2019, it would join a gaggle of highly valued startups, like Uber Technologies and Lyft., that have stayed private for years and are now gearing up for debuts next year.
Pinterest’s CEO Ben Silbermann has said the company would look to debut in 2019, without being more specific.
Bankers and advisers say some companies have ramped up IPO preparations to get ready to go public in the first half because of concerns about a steeper market selloff next year. Uber and Lyft both recently filed paperwork confidentially with the Securities and Exchange Commission for IPOs that could come as soon as early 2019, The Wall Street Journal has reported.
Pinterest is also in conversations with banks for a credit line that could come in at around $500 million, these people said. Companies tend to make such moves ahead of their IPOs, and banks are often incentivized to lend to companies in the run-up to an IPO to land a key role on the offering. Pinterest recently contacted a number of large banks asking how much they would be willing to commit to the loan, and at what terms, the people said.
The IPO market has been hospitable for fast-growing tech companies—even those that lose money. On average, shares of newly U.S.-listed tech firms have risen an average of roughly 4.2% this year, according to Dealogic, outpacing the year-to-date gains in broader stock indexes. So far this year, 55 technology companies had debuted on U.S. exchanges, raising $20.9 billion, according to Dealogic. That’s more than technology companies had raised for the full years in 2015, 2016 and 2017, but down from 2014.
Write to Maureen Farrell at email@example.com