Service Titan stock soared 42% in its first day of trading on the Nasdaq market Thursday. This is likely to be the last major IPO by a venture-backed unicorn this year.
The Glendale, California-based company, which provides a platform for architectural services professionals, priced its IPO at $71 per share late Wednesday. This was above the expected range of $65 to $67, giving the company an initial valuation of approximately $6.3 billion.
The company, which trades under the symbol TTAN, had a market capitalization of about $7.6 billion at Thursday’s closing price of $101.
The offering caps a relatively slow year for tech company initial public offerings (IPOs). Overall, the first half of the year was more active, with large offerings from discussion platform Reddit, connectivity technology developer Astera Labs, and data security provider Rubrik receiving positive reviews.
However, in the second half of 2024, technology delivery activity slowed and the vast majority of U.S. unicorns opposed their listing applications. ServiceTitan has long been considered a favorite on the list of IPO candidates, but its S-1 filing in mid-November was an exception.
Funds equivalent to more than 10 years
The company, founded in 2012, had previously raised at least $1.5 billion from a long list of venture and private equity backers. According to the S-1, the largest holders of ServiceTitan’s Class A common stock include Iconiq Growth (24%), Bessemer Venture Partners (13.9%), Battery Ventures (7.5%) and TPG (6.4%).
ServiceTitan was reportedly valued at $9.5 billion, near its market peak after a 2021 funding round.
In terms of financial performance, the company’s financial reports show an increase in revenue along with a reduction in net losses. For the six months ended July 31, ServiceTitan generated revenue of $348 million, an increase of 26% compared to the same period in 2023. Net losses for the same period in 2024 totaled $92 million, down 12% from the previous year.
Much of the loss was due to high spending on sales and marketing ($116 million for the six months ended July 31) and research and development ($121 million for the same period). Not including these and administrative costs, ServiceTitan said its gross profit was $233 million.
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Illustration: Dom Guzman
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