Rivian to Raise $11.9B From Mega-IPO

The startup's valuation "highlights the belief on Wall Street that the fast-growing electric vehicle market is still a wide-open field."
Matthew HellerNovember 10, 2021

Rivian priced its IPO well above expectations at $78 per share on Tuesday, setting the stage for a big Wall Street debut amid investor enthusiasm for the electric vehicle industry.

The offering of about 20.7 million shares was expected to raise $11.9 billion and value Rivian, if underwriters exercise their full purchase option, at close to $70 billion, approaching the market cap of Ford Motor.

Rivian had increased the expected price range last week to between $72 and $74 from a previous range of $57 to $62, with investor interest being fueled by a roadshow at which the startup’s bankers compared it to electric-vehicle giant Tesla.

The IPO would be the largest of the year and sixth-largest ever on a U.S. exchange.

Rivian’s valuation “highlights the belief on Wall Street that the fast-growing electric vehicle market is still a wide-open field,” The New York Times said.

Before the IPO, the company had raised more than $10 billion from investors including Amazon and Ford. “It’s the latest EV company to attract hefty investor capital at a stratospheric price without yet proving that it has a sustainable business model,” the  Times said.

Rivian, which was founded in 2009, began delivering its R1T pickup trucks in September and plans to start deliveries of an SUV, the R1S, next month. It is also developing delivery vans with Amazon.

According to the IPO prospectus, Rivian had approximately 55,400 R1T and R1S preorders in the U.S. and Canada as of Oct. 31 but it does not expect to fulfill the orders until the end of 2023.

“We believe the combination of our deep focus on addressing climate change, building compelling products, and delivering a superior customer experience will enable Rivian to drive adoption and customer loyalty, powering our continued growth,” the prospectus said.

The company has yet to make any money, reporting a net loss of $994 million in the first six months of this year, which was almost as much as in all of 2020, when it lost $1.02 billion.

But despite the big losses, investors at the pre-IPO roadshow “were clearly receptive and drawn to the company’s growth potential,” The Wall Street Journal reported.

Photo by Spencer Platt/Getty Images