Peloton, the vivacious manufacturer of expensive stationary bikes and treadmills with internet access, is targeting an initial public offering worth $ 8 billion, twice the value of the losing company just a year ago.
The offer, expected later this year, would allow Peloton to raise up to $ 1.3 billion, according to the most recent S-1 document filed with the SEC on Tuesday.
Peloton's Ambitious IPO Plans Come at a Glance Another high profile company, WeWork, was brutally tested after launching its IPO process and reportedly had to lower the price it expects for its stock.
The two New York-based companies share much in common, including controversial capital structures that focus on controlling insiders and huge losses. Peloton has suffered a net loss every year since its inception in 201
Peloton plans to sell 40 million shares of its Class A stock to public investors with prices ranging from $ 26 to $ 29. The company said the IPO subscribers would have the right to acquire another 6 million Class A shares.
The IPO would estimate Peloton between 7 and 8 billion US dollars, depending on where the stock price is. This is a significant advance over Peloton's recent private-sector valuation in 2018, when venture capitalists announced $ 4 billion.
Peloton was founded in New York in 2012 and sells $ 2,000 in stationary bicycles with internet access and expensive treadmills. Customers also pay between $ 19 and $ 40 per month for access to specially crafted live practice classes.
The company boasts that its "churn rate", the percentage of subscribers who cancel the service, is extremely low. However, according to business loyalty experts Business Insider has spoken with, the churn indicators reported by Peloton are clearly undervalued.
Peloton, which lost $ 246 million in fiscal year 2019 despite rapidly growing revenues, plans to trade on the Nasdaq Stock Exchange under the title "PTON" ticker.