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It has already been the busiest year for IPOs in the U.S. since the dot-com boom, with superstar companies such as Robinhood, Coinbase and Didi Global leading a mad dash to the public markets that has generated nearly $100 billion in total proceeds.
But the biggest debut of the bunch may still be to come.
Rivian announced on Friday that it submitted confidential paperwork for an IPO, with Bloomberg reporting the maker of electric pickups and SUVs hopes to list sometime around Thanksgiving and will seek a valuation of some $80 billion. If the company’s initial market cap does reach that lofty level, Rivian would immediately become one of the five most valuable automakers in the world, leaving industry giants such as Ford, Honda and General Motors in its environmentally friendly dust.
Go to the very top of that list, and you’ll find the name that, more than any other, seems to be Rivian’s white whale: Tesla. As of this writing, the brainchild of Elon Musk has a market cap of about $705 billion—more than double the $283 billion market cap of Toyota, the globe’s most valuable traditional car company.
Getting to Tesla’s level will be tough. But if it can be done by any of the dozens of companies from around the world that have been raising billions of dollars in funding in recent years in a bid to bring electric vehicles to the masses, Rivian might be the best bet.
One reason for that is the huge sums of capital Rivian and CEO RJ Scaringe have at their disposal. Since the start of 2019 alone, the Irvine, Calif.-based company has brought in about $10.5 billion in backing across seven discrete financing rounds, according to PitchBook. That’s a rate of fundraising unsurpassed by any startup on the planet over that span. This January, one of those multibillion-dollar rounds pushed Rivian’s valuation to a reported $27.6 billion.
The auto industry can be very capital intensive. Rivian’s incredibly deep pockets set it apart from the competition, even buzzy rivals from China such as Nio and Li Auto.
Another reason Rivian could emerge from the EV crowd is the names of the investors who have been supplying all that cash. Amazon is a longtime backer, as well as an early customer: In 2019, it placed an order to eventually buy 100,000 electric delivery vans from Rivian. Ford, Cox Automotive, T. Rowe Price, Fidelity and BlackRock are also investors. Major auto companies, Wall Street giants and one of the biggest companies in the world all have a financial stake in Rivian’s success.
That doesn’t guarantee anything, of course. But you’d probably rather have Amazon on your side than not—particularly if the end game is to become a true rival to Tesla. As my colleague Alan Ohnsman writes, the immediate competition between Rivian and Tesla will play out in the realm of electric pickups, where the former’s R1T model will compete with the latter’s Cybertruck. Rivian’s vehicle is pretty much a traditional pickup that happens to run on a battery—albeit one that’s upholstered with vegan leather and comes at a $67,500 price tag. That’s in sharp contrast to Tesla’s model, which looks like it was inspired in equal parts by “Blade Runner” and Porygon.
Rivian is also planning to offer an electric SUV, called the R1S. Initial production is scheduled to begin in the coming months for both it and the R1T, with manufacturing set to ramp up in 2022.
Will Rivian be publicly traded by then? It’s still far from a sure thing. We’ve seen several companies postpone planned public offerings in the past few weeks due to market conditions, raising the prospect that the year's IPO gold rush could be nearing an end. Rivian could also be slowed by the chip shortages and other supply-chain woes that have hindered automakers around the world since the onset of the pandemic. Just last month, parts shortages forced Rivian to delay the start of its pickup production.
But for the time being, at least, Rivian and Scaringe are getting ready for a public offering that could serve as the starting line for a full-on battle with Tesla and Musk for electric vehicle supremacy. Gentlemen, start your engines.
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August 29, 2021 at 06:00PM
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Rivian Revs Up For An $80 Billion Electric Truck IPO—And A Showdown With Tesla - Forbes
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