ServiceTitan Shares Soar 42% in Nasdaq Debut
ServiceTitan, a provider of cloud software to contractors, made its successful Nasdaq debut on Thursday, with its shares surging 42% to close at $101 per share. The initial public offering (IPO) of around $625 million was sold at $71 per share, above the expected range.
The company, trading under the ticker symbol TTAN, becomes the first significant venture-backed tech company to go public since Rubrik’s debut in April. The timing of the IPO is notable, as few tech companies have taken the public market leap since the end of 2021, when rising interest rates and inflation pushed investors out of risky assets.
ServiceTitan’s president, Vahe Kuzoyan, described the market’s reception as “great” and said that it opens up opportunities for more IPOs. The company’s CEO, Ara Mahdessian, noted that the decision to go public was not influenced by the “compounding ratchet” terms agreed upon in a 2022 funding round that valued the company at $7.6 billion.
ServiceTitan provides software for managing sales leads, recording calls, generating quotes, and scheduling jobs for businesses in the plumbing, landscaping, electrical, and other trades. As of January 31, the company had around 8,000 customers with more than $10,000 in annualized billings. The company reported a net loss of approximately $47 million on $198.5 million in revenue for the October quarter, with a year-over-year revenue growth rate of 24%.
The company’s valuation at the closing price of $101 per share is 12 times its trailing 12 months revenue, higher than the 6.4 times revenue of the WisdomTree Cloud Computing Fund, a basket of more than 60 publicly traded cloud stocks.