Asana Set to Test Direct Listing Model Alongside Palantir

Crystal Tse, Bloomberg News

(Bloomberg) -- Palantir Technologies Inc. isn’t the only Peter Thiel-backed company going public this week. Workplace management software firm Asana Inc. is also set to debut through a direct listing, an alternative route to going public last tested in 2019.

Shares of Asana, whose founders include Facebook Inc. co-founder Dustin Moskovitz, will begin trading on the New York Stock Exchange on Wednesday, without the company issuing new shares or raising capital as it would in a traditional initial public offering. Asana has registered 30 million shares that could trade on the first day.

Asana’s market valuation could range from $3.7 billion to $4.3 billion, analysts from MKM Partners wrote in a note, based on a sales multiple of 12 to 14 times in 2021. That range implies an initial reference price of $24 to $28 a share. The reference price, expected to be disclosed Tuesday, serves as guidepost for investors and is needed by the exchange for trading to begin.

At that price, Asana would start its journey as a public company at a valuation below the $5 billion it has fetched on the secondary market. The company was valued at $1.5 billion in a 2018 funding round led by Al Gore’s Generation Investment Management.

Benchmark Capital and Thiel’s Founders Fund are among Asana’s backers.

Palantir, which Thiel co-founded, is also slated to go public on Wednesday through a direct listing. Only two major companies have previously completed direct listings: Spotify Technology SA in 2018 and Slack Technologies Inc. last year. The NYSE, a subsidiary of InterContinentalExchange Inc., was the venue chosen for both.

A beneficiary of the work-from-home shift accelerated by the coronavirus pandemic, Asana reported 57% year-over-year revenue growth for the three months ended July 31. Its net loss during the period jumped to $41.1 million, compared with a $15.6 million loss for the same period last year. The company has yet to turn a profit.

Direct Listings to Take Center Stage as Palantir, Asana Debut

Apart from Thiel, it’ll also be a hectic day for Morgan Stanley, which is acting as the lead adviser on both Palantir’s and Asana’s listings. JPMorgan Chase & Co., Credit Suisse Group AG and Jefferies Financial Group Inc. are also financial advisers to Asana.