2. October 2023

Nordic Eyes insight on two IPOs

Arm’s IPO and Instacart’s IPO, matter as they represent the first two big elephants out of the gates to get the IPO market moving again. Since 2021, the US IPO market has taken a pause with ca. 75% fewer IPOs compared to 2021. To put Arm’s IPO in perspective, the proceeds generated ($4.75bn) are half (53%) of the total proceeds from US IPOs in entire 2022 ($9bn) (!). On a note to valuation, crazy multiples are apparently still achievable at this stage – see below.

Thus, both IPOs are positive signs of a healing IPO market which ultimately impacts and sends positive waves down the ecosystem to our companies.



  • Valuation: $52bn
  • Announced share price range of $47 to $51 per share
    • Issued at $51 per share, trading started at $56 per share
  • Proceeds: ca. $4.85bn
  • Ownership: Softbank 100%, selling ca. 10%
  • Implied revenue multiples
    • 31.3.2022 – 31.3.2023: 19.4x
      $52.0bn / $2,679.0bn = 19.41
    • 31.3.2023 – 31.3.2024E:18.4x
      $52.0bn / $2,832.0bn = 18.36
    • Expected growth 23-24: 5.7%
  • Implied EBITDA multiples
    • 31.3.2022 – 31.3.2023: 77.5x
      $52.0bn / $0.671.0bn = 77.49

1st day of Trading

  • Finishing the day 25% higher, ending market cap of ca. $65bn
    • Trading opened (12pm) at $56 per share, ended at $63.6 per share
    • Within the first 26 minutes, the stock had climbed to $62 per share (+20%)
    • From 12.30 – 3pm it went sideways
    • 3-4pm, the share price saw an uptick which peaked at $65.5 per share, 5 minutes to closing, then dipping to $63.6 at closing
  • Apple, Google, Nvidia, Samsung, AMD, Intel, have bought $0.74bn worth of shares

Arm Holding – company information

  • Arm, founded in 1990, is a UK-based chip design company that creates ARM-based processors for various devices and applications. Approx. 70% of the world’s population uses ARM-based products
    • Most well-known competitor: IBM
  • “(…) Arm is defining the future of computing. Semiconductor technology has become one of the world’s most critical resources, as it enables all electronic devices today. At the heart of these devices is the CPU, and Arm is the industry leader of CPUs.”
  • Arm was acquired by SoftBank in 2016 and is now public under the ticker “ARM” on Nasdaq


“(…) Instacart is a US delivery company based in San Francisco that operates a grocery delivery and pick-up service. The company allows customers to shop at local grocery stores via an app or their website, creating a virtual shopping cart that is later fulfilled by a ‘personal shopper’ on a designated day”. On top, the company has pivoted to advertising which now represent c. 30% of total revenue. C. 70% of revenue in generated on the marketplace (Take-rate on GMV). Instacart did c. $1.5bn in 2023 YTD total revenue.

Instacart is the first meaningful VC-backed IPO since 2021. Valuation is taking a massive hair-cut to most recent financing round (pre IPO) where the company raised on a $39bn valuation (!) which implied a revenue multiple of 21x assuming 2021A revenue of $1.83bn. Keep in mind, this was back in the crazy-valuation-days…

IPO revenue multiple around 3.4x – 3.7x to 2023E revenue, and 3.9x to 2022A revenue – see below.

Below some take-aways from Instacart’s IPO.


  • Announced share price range of $28 to $30 per share
    • Issued at $30 per share, trading started at $41.08 per share
  • Proceeds: ca. 660 million
  • Ownership: Founder 17% collectively, Sequoia 15%, D1 Capital Partners 14%, others, 54% incl. YC, Tiger, A16z, Fidelity
  • Selling: 6.6% in total, of which the Company sold 64% of total share capital
  • Implied Revenue multiples
    • 2022A: 3.9x
      $10.0bn / $2,551m  = 3.92
    • 2023 normalized revenue based on YTD (June) actuals: 3.4x
      $10.0bn / ( $1,475m x 2)  = 3.39
  • Implied GMV multiples
    • 2022A: 0.35x
      $10.0bn / $28.8bn = 0.35
  • Revenue growth from 2021 to 2022: 39%
    22-23 growth based on normalized 2023E revenue: c. 15%
  • Adj. EBITDA margins
    • 2021A: 2%
    • 2022A: 7% (c. $178m)
    • 2023 YTD: 19% ($280m)

1st day of Trading

  • Started trading at $30, hit a peak of $42.95 in the first few minutes of trading
  • Closed up 12.3% at $33.7, giving the company a market value of more than $11bn
  • PepsiCo, invested $175m in the IPO, or 26.5%, of the total issued share capital

Useful link if interested.