Darktrace – UK cyber security company, has settled on a London IPO in the first half of 2021 targeting $5B (£3.8B) valuation.
Darktrace shares jumped by 40% on its London Stock Exchange debut on Apr 30, 2021, after the initial public offering raised £165m for the cyber-security company and its investors.
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What is an IPO and how it works
IPO is a process of offering shares of a private corporation to the public in a new stock issuance. Why go public? The primary benefit of going public is easier access to capital.
To go public, a company must have a track record of growth and other favorable results and hire an investment bank (UBS and Berenberg in Darktrace's case) to come in and underwrite the IPO. The underwriters also performed due diligence and verified financial information and business model.
Once the paperwork done, the company sells the stock to institutional investors. When the initial block of shares has been sold, the company with underwriters' help sets an initial price and date for the stock to begin trading on a stock exchange.
Company Profile and Financial Indicators before Darktrace IPO
Founded in 2013 and headquartered in Cambridge, UK, Darktrace focuses on AI based software for cybersecurity that helps track down hacker attacks and protect data. The software was developed by some leading UK mathematicians.
As of 2021, Darktrace caters to over 4,000 companies, including British Telecom and HSBC. Since its inception, the company handled over 63,000 cyber-attacks, which would have otherwise not even been detected.
Due to its cyber intelligence innovations, Darktrace gained a lot of customers, including some world-renowned companies. In 2020, KKR Corporation and Summit Partners invested $100M more into the company, the total value now reaching $5.2B, or £3.80B, according to some analysts. Dartrace's market cap is currently $2B at max,
while its earnings per year are at around $200M. In 2020, due to the coronavirus pandemic, most businesses switched to remote work, which helped Darktrace to register an over $1B revenue.
How to Buy Darktrace Stocks Before the IPO (Offering Price)
In the past, IPOs as highly profitable investments were available only to the privileged customers of the leading brokerage firms and it was challenging for retail investors to gain access. You couldn't buy shares paying the price set by the company and you had to wait until the shares actually start trading on the public stock market at whatever stock price supply and demand allows.
Technologies and marketplaces changed the rules of the game, now regular investors can get pre-IPO shares. To participate in Darktrace IPO you need to use an IPO investing app like Freedom Finance (NASDAQ: FRHC), TD Ameritrade or Fidelity. They give its customers access to IPOs and secondary offerings through their existing brokerage account. Also you can buy Darktrace shares when the company goes public via a commission-free trading app like eToro.
🚨 Detailed Instructions How to Participate in the Darktrace IPO before public trading:
Below we share the instruction how to participate in the approaching Darktrace IPO using Freedom Finance (Freedom24 platform). This marketplace is chosen as an example because Darktrace is already listed there.
- Pros: almost all high-profile IPOs are available for participation via Freedom Finance, no eligibility requirements, no number of previous trades needed and low minimum investment amount for participating in an IPO.
- Cons: the user interface of the platform is a bit outdated.
* Freedom Finance services are NOT available to US citizens and residents.
- Apply for a Freedom Finance account — you need to prepare your identity document and a document confirming the address of residence (utility bill). The verification process is very fast, it will take 2 minutes to create your account.
- Deposit your account — to participate in an IPO, your account must have available funds in the amount you send IPO application for.
- 💡 Tip: It's recommended to deposit your account in advance. Often the exact IPO date is undefined until the last day. You may have a short notice for participation and account deposits also takes time for processing. Also, sometimes Freedom sends last-minute IPO offer when you have 2 hours to participate.
- Submit a request to participate in the IPO — when applications are open select Darktrace and click Participate in the IPO > input the amount you want to invest > Send your application. Note: Before the book closing, a request can be withdrawn. At the time of the book closing, 1 day before the start of the exchange trading, the specified amount will be blocked on the account.
- Wait for allocation — The actual number of stocks purchased during an IPO depends on supply and demand. The higher underwriter reserves the right to partial execution of collective applications. So if the demand is high you may get less than you applied for. Of course, you will only pay for the shares purchased. The rest of the funds will be returned to your account.
- Start of trading — With the beginning of the public trading on the stock exchange, the purchased shares will appear on the account and a lock-up period will start — a 93-day period of prohibition on sale. You can’t sell stocks, but you can track their current value and growth indicators in your personal member area and a trading terminal.
- Closing your trade — At the end of the 93 days lock-up period, you will be able to manage your stocks at your discretion — leave in the portfolio or sell and withdraw money or transfer the stocks to another depository/ broker in your name. This can be done in your account by clicking the ‘Sell’ button next to the name of the security. In this case, a commission of 0.5% of the amount of the sale transaction is charged.
Is investing in IPOs profitable?
Not always. The average return at the end of the lock-up period is 72%, past IPOs data.
When is the Darktrace IPO date?
The date for Darktrace IPO has not been announced yet. The company is surely getting ready for going public, as the investments come from many banking structures and global corporations.
We will update when the exact Darktrace date IPO is known – if you want to get notified please subscribe for updates here.
What is Darktrace IPO price range?
Not defined yet. We will update when the Darktrace IPO offering price is known – if you want to get notified please subscribe for updates here.
How to Invest in Darktrace after the IPO date (opening price)?
In what currency Darktrace IPO and post-IPO shares will be traded?
The Darktrace IPO and stock trading currency will be GBP sterlings.
If you have funds in another currency the cheapest way to convert your currency is to use the mid-market rate (that’s the one you’ll find on Google) which can be done via a fintech service like Transferwise. Banks may add hidden markups to their exchange rates - charging you more without your knowledge. And if they have a fee, they charge you twice. TransferWise never hides fees in the exchange rate.
What is the Darktrace (stock symbol)
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