Grocery delivery company and one-half of Nasdaq’s white knight duo, Instacart, has recalibrated its initial public offering expectations yet again, according to Wall Street Journal reports.
Instacart is now gunning for a valuation somewhere between $8.6 billion and $9.3 billion through its Goldman Sachs (NYSE:GS)-underwritten IPO, insiders told the WSJ over the weekend.
This is in stark contrast to the $39 billion valuation initially cited by the California-based gig economy group back in March 2022.
Instacart shelved its IPO plans that year as the markets tanked and the appetite for tech IPOs disappeared, after which the group’s in-house valuation shrunk by half, then two-thirds earlier this year.
If reports are accurate, Instacart’s expected valuation is now merely a quarter of what it was just 18 months ago.
Arm Holdings, the other half of Nasdaq’s white knights, has also cut its valuation. Once thought to be worth $70 billion, the British semiconductor designer’s parent company SoftBank has since rebased its expectations closer to $54 billion.
Despite these shrinking valuations, a lot is riding on Instacart’s and Arm’s IPOs, with Wall Street hoping their flotations will revive sluggish and inactive capital markets.
Goldman Sachs (NYSE:GS)’ boss David Solomon recently stated that “over the course of the next few months, especially if Arm and some of these other IPOs go well, I think you’re going to see a meaningful increase in activity”.
However, he also warned that M&A activity, which is Goldman’s bread and butter, will likely trail an uplift in IPO activity.