"ServiceTitan Hits Billion-Dollar Mark with Record-Breaking IPO Debut"
Shares of ServiceTitan, a cloud-based software company, rose about 42% on their U.S. market debut on Thursday, giving the company a valuation of nearly $9 billion. The company's shares opened at $101 apiece in their Nasdaq debut, compared to the initial public offering (IPO) price of $71.
The valuation is a step down for ServiceTitan, which was valued at $9.5 billion after a Thoma Bravo-led funding round in 2021. However, strong equity markets and expectations of lower interest rates have bolstered investor confidence in the U.S. IPO market this year. This has led to a surge in demand for IPOs, with several venture capital-backed firms going public this year.
ServiceTitan joins a handful of major tech firms that are moving toward a U.S. listing, including social media platform Reddit and cybersecurity software firm Rubrik. Reddit's stock price has increased nearly fivefold from its IPO levels, while Rubrik's shares have more than doubled as of last close.
Sweden's buy now, pay later platform Klarna and Genesys, an AI-driven developer of call-center software, are also among the major tech firms that are moving toward a U.S. listing. This trend is expected to continue in 2025, according to Joe Endoso, president of Linqto Capital.
"The higher-than-expected pricing of ServiceTitan's IPO reflects strong demand for the stock and signals growing investor interest in public markets for IPOs," said Endoso added. The startup sold 8.8 million shares in the IPO, raising about $625 million. Goldman Sachs, Morgan Stanley, Wells Fargo, and Citigroup led a 14-firm underwriting syndicate for the IPO.
ServiceTitan was founded by Ara Mahdessian and Vahe Kuzoyan, who have become a dominant player in a niche market. The company makes software used by more than 11,800 businesses that are run by technicians serving the heating, ventilation and air-conditioning sectors. With its strong business and favorable market conditions, ServiceTitan's IPO marks an exciting milestone for the company.
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