According to a Bloomberg report citing people familiar with the matter, leading website builder and web hosting company Squarespace has revealed that it will seek a direct listing this year rather than a traditional initial public offering (IPO). This move by Squarespace follows tech companies like Slack, Spotify, Roblox, Asana, and Palantir choosing to file a direct listing rather than an IPO. Cryptocurrency exchange Coinbase also announced its intention to seek a direct listing proposal for its Class A common shares in January of this year.
The website creator decides
However, reports suggest that Squarespace's plans may not be set in stone as dates may shift, the report notes. By choosing to go with a direct listing, Squarespace will save money on bank charges and save time that would otherwise have been spent on investor roadshows, which is common practice in a traditional IPO. TechRadar Pro has contacted Squarespace for comment, but the company has yet to respond. Compared to an IPO, a direct listing will mean that Squarespace will have no new shares created and only the existing outstanding shares will be sold without any input from underwriters. The underwriter works closely with the company throughout the initial public offering process and decides the initial offering price of the shares. Subscribers typically charge a fee per share, which can range from 3% to 7%, a fee that Squarespace will save with its direct listing option. A month ago, Squarespace raised an additional €300 million in its latest funding round and the company is now valued at €10 billion. Founded in 2003 by CEO Anthony Casalena, the company also announced its intention to go public earlier this year. Squarespace has grown in the eCommerce market and recently acquired Tock, a unified system serving the hospitality industry with online reservations, table management, takeout and events. Today's Best Squarespace Deals Via Bloomberg