Startup Rivian has finally gone public, its IPO reaches almost $80 billion making history as the sixth biggest initial public offering. The Rivian stock soared as high as $106 and then settled around $78 yesterday November 11 2021.
This high valuation is a testament to how much value, investors believe its stock would hold in the future. Tesla has been the most popular electric vehicle stock and Rivian is heading in that direction.
Surprisingly, the company is yet to make a profit just like Tesla in its early days. Rivian will be burning a lot of cash in order to start producing and delivering all of its 3 electric vehicles by the end of the year.
Rivian recently filed to go public with the RIVIN ticker. This IPO Initial Public Offering will happen over at the Nasdaq exchange where most technology companies carry out their valuation.
The company made the news public on October 1st 2021. The Amazon and Ford backed company currently has more than 48,000 R1T and R1S pre-orders from Canada and the United States.
Interestingly, the company says it has made a $994 million net loss for the first half of 2021 and $1.02 billion for the whole of 2020. It currently has no revenue for the first half of 2021. “We are a development stage company and have not generated material revenue to date,” Rivian writes in the filing. “Vehicle production and deliveries began in September 2021.”
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While it tries to stay afloat, monies from its Sponsors Ford and Amazon would help pull in revenue. “In the near term… we expect that a significant portion of our revenue will be from Amazon Logistics.”
According to reports in August 2021, the company was preparing for an $80 billion traditional initial public offering (IPO). The electric van company didn’t use the SPAC merger widely used by technology companies in the past 5 years.
The close to $80 billion company valuation would pump the company’s cash flow to build its new factory. It will also maintain the quality of its deliverables and future demands of its vans.
Rivian is now in a race to stay afloat, bringing its losses to a minimum and survive the cash-hungry automotive industry. Will the startup go almost bankrupt like Tesla in its early days? Time will tell.
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