It has been less than a week since Rivian dropped a veritable bucketload of news, but it just keeps coming. We reported that the electric truck startup announced that deliveries of its truck would start in July, with all pre-orders delivered by next summer, plus some other news about upgrades. Now the news is bigger, with Rivian disclosing that it has chosen underwriters for an IPO that is said to be coming in 2021.
According to Bloomberg, the advisers that Rivian will be working with on the IPO include Morgan Stanley, JPMorgan Chase & Co., and Goldman Sachs Group. Inside sources have said that Rivian could be seeking a valuation of about $70 billion when it goes public. This valuation is not set in stone and may change. We have seen other companies in the tech space set high valuations and then quickly experience a drop in share price, but Rivian is in a good position. In July last year, it raised a whopping $2.5 billion in a funding round, and in January of 2021 it raised a further $2.65 billion in an investment round. Since 2019, the company has raised a total of $8 billion and attracted major investors, most famously Amazon.
Rivian is considered one of the major rivals to Tesla’s position as the leader of the electric vehicle industry. Its R1T truck can be seen as a direct competitor to Tesla’s Cybertruck, and we have already published a comparison feature on the two vehicles. Also, the Rivian R1T is in the running to be voted the 2021 CleanTechnica Car of the Year.
One point of note is that if Rivian does reach the $70 billion valuation target, it will have done this in a much shorter time than it took Tesla to reach a similar valuation. If Tesla had gone public in 2018 during its privatization attempt, it would have achieved a valuation of $71 billion. At that stage, Tesla had already released multiple vehicle models and was operating its Gigafactory in Nevada. That is significantly more than Rivian has achieved to date, which has of course not delivered its first vehicles yet.
Detractors might claim that the IPO valuation is too high, but there is a strong chance that it is an indication of how large the electric vehicle market is set to become. The EV competition is fascinating as always.
Featured image courtesy Rivian