Secretive data-miner Palantir could fetch a $22 billion price-tag at its market debut next week, WSJ says

• Palantir, the secretive technology firm, could fetch a $22 billion price-tag at its planned market debut on September 30, the Wall Street Journal reported on Thursday.
• Palantir’s bankers have said the company could start trading at $10 a share, equating to a market valuation of about $22 billion.
• The controversial company is choosing to bypass the traditional initial-public-offering route, and opt for a direct listing instead.
• In the past year, Palantir’s stock in its private listing has trended higher.
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Big-data company Palantir Technologies is expected to carry a $22 billion price-tag when it goes public by the end of September, WSJ reported.

The data-miner is avoiding a traditional IPO route and instead choosing to go public via a direct listing, the Journal reported.

According to WSJ, Palantir’s bankers have told investors that shares could start trading at $10 each, giving the company a market valuation of about $22 billion. It isn’t certain whether the company’s shares could start trading at that value, and whether they will stay at that level for long, the paper said.

Palantir’s stock has drifted higher in its private listing over the past year. In August, the volume-weighted average price was $7.31 and in September, $9.17.

Ordinarily, offering existing shares through a direct float is cheaper and faster than an IPO, and the company wouldn’t need to utilize a number of middlemen to underwrite the listing. That means the company prefers to fly solo and hopes there’s already enough pent-up investor interest. At the same time, it saves itself from having to pay hefty fees in the process.

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Sweden’s Spotify also chose to bypass the IPO route in 2018, owing to its unique combination of brand recognition and an already-massive private market valuation.

Palantir was founded in 2003 by a group of PayPal alumni and Stanford computer scientists, including CEO Alex Karp and venture capitalist Peter Thiel. 

The company is notoriously secretive because of its dealings with governments around the world and controversial work with agencies like the Immigration and Customs Enforcement.

It creates software to manage, analyze, and secure data. Its name comes from a mystical, spherical object in the “Lord of the Rings” that allows its owner to “see from afar.” In total, the company has raised $2.75 billion in venture capital.

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