Boston-based tech firm Toast’s share price jumped when it debuted on the New York Stock Exchange.
Shares of the payment and restoration software company opened at $ 65.26 on Wednesday morning, 63% above the price set in its initial public offering. At the end of the day, the stock closed at $ 62.51, a 56% gain from the IPO price, giving the company a value of more than $ 30 billion.
Wall Street underwriters sold 21.7 million shares of Toast on Tuesday night at $ 40 a share, which was already above the $ 34- $ 36 range the company had anticipated days longer. early. The huge pop represents the purchase by many investors who were unable to participate in the IPO sale.
Toast has raised $ 870 million under the deal, which it plans to use to expand its software and services to the restaurant industry. Toast sells handheld devices and tablets that restaurants use to take orders and accept payments, as well as a suite of software to manage everything from taking online orders to organizing and paying staff.
“Restaurants are a massive industry,” co-founder and COO Aman Narang said in an interview. “We are still in the early stages of where this could go … [Restaurants] are not technologists, but they have realized how important technology can be to them in order to run more efficient businesses.
Toast’s business was initially crushed by the COVID-19 pandemic as thousands of its restaurant customers were forced to close and it laid off half of its workforce. But the company quickly created new products to help restaurants pivot and offer take-out and delivery. Toast’s revenue in the first half of 2021 more than doubled to $ 704 million from the same period in 2020, although its net loss also widened to $ 235 million, from $ 125 million a year earlier. early.
Toast’s market capitalization also makes its three co-founders – Narang, Stephen Fredette and Jonathan Grimm – billionaires on paper, according to a filing with the Securities and Exchange Commission listing their shares.
Toast’s valuation was the highest on record for a Massachusetts company that went public via an IPO, surpassing the $ 10.7 billion market value of internet company Genuity when it went public in 2000, according to the reports. data from Dealogic. And with Boston-based life science company Ginkgo Bioworks debuting at around $ 20 billion, Toast’s IPO marks a moment of broader strength on the Boston tech scene.
The strong day one performance of Toast’s shares follows growing investor enthusiasm for the shares of the company’s competitors. Square’s share price has risen 71% over the past year and Lightspeed Commerce has gained 320%.