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Coinbase reportedly considering public debut in late 2020 and early 2021

Coinbase is the latest mega-startup likely to approach the public markets. The digital currency company could follow Palantir, which is also on the cusp of its IPO, after the secretive data-driven unicorn announced it had filed privately.

Earlier today, Reuters reported that Coinbase, a popular U.S.-based cryptocurrency trading platform, could make its public debut later this year or early next year. Plans remain fluid, according to the report, which adds that the crypto-focused fintech company “has been in talks to hire investment banks and law firms.”

Coinbase declined to comment, telling TechCrunch in an email that it could not “comment on rumors or speculation.”

Even more, Reuters reported that Coinbase may pursue a direct listing of its shares, instead of a more traditional initial public offering. A direct listing allows a company to begin trading on a stock exchange without formally pricing its shares through a block sale, as is the case with initial public offerings. Direct listings have become a more popular concept in recent years, as private companies have become less reliant on IPOs as a fundraising mechanism, and some members of Silicon Valley’s elite have become disillusioned with what they see as consistent underpricing of IPOs, forcing IPO companies to exit the market. tens, if not hundreds of millions of dollars on the table.

Coinbase is perhaps an archetype of the type of company that might consider a direct listing. It is wealthy, having raised over $500 million in its lifetime as a private company, and highly regarded. Coinbase’s most recent private funding of $300 million valued it at $8 billion, according to Crunchbase data. A high valuation and the possibility of significant cash reserves are also what Slack and Spotify previously listed directly.

Most companies still go public through IPOs, as we’ve seen in recent weeks with the traditional debuts of Accolade, Vroom and others. Yesterday, TechCrunch covered the initial price ranges of two other IPOs, GoHealth and nCino, each of which eschewed the direct listing model in favor of raising capital as they exited the private markets.

Results

It’s unclear how big Coinbase is today. The company’s financial history is hidden – which is common in private companies – and a bit spotty. Media reports put its 2017 revenue at around $1 billion, boosted by that year’s crypto mania. Coinbase’s precise performance in 2018 is less clear, although other media outlets paint a picture of a smaller company.

Whether Coinbase goes direct listing or undertakes a traditional IPO, we will see its S-1 filing. This document will provide a good overview of the company’s historical financial performance, allowing us to see how Coinbase has performed during various crypto booms and busts.

With public markets hitting all-time highs and tech stock valuations well above historical norms, it’s no surprise that some highly valued unicorns are gearing up for a run on the public markets. Let’s see how many succeed.