After delaying debut plans in order to improve its financial standing, Blue Apron Holdings Inc., a popular meal-kit delivery service, filed for an initial public offering with the SEC on June 1.
The New York-based company will be listed on the New York Stock Exchange under the symbol APRN. It hopes to raise $100 million in its IPO.
Blue Apron plans to offer its Class A common stock and will have three share classes, two of which will have voting rights.
Founded in 2012, Blue Apron sends customers weekly boxes containing pre-portioned ingredients with instructions to cook meals at home. The smaller of its boxes provides three meals for two people for $59.94. It also offers two different options for families of four. Recently, it has been diversifying its menu to better accommodate consumers’ dietary preferences.
The company’s net revenue has grown more than 10 times over two years, from $77 million in 2014 to $795 million in 2016. Despite this growth, Blue Apron is still losing money as it faces stiff competition from HelloFresh AG, Plated and Sun Basket Inc. as well as Amazon.com Inc. (AMZN, Financial). In the first quarter, the company reported a loss of $52 million on quarterly revenue of $244 million, nearly as much as the $55 million loss on $795 million in revenue in all of 2016.
The fight for market share has proven to be expensive as the company spent $144 million on marketing last year, around 17% of its total operational spending. In addition, Sun Basket is also planning to go public, making the competition for customers and investors even fiercer.
At the end of the first quarter, Blue Apron reported it had 1 million customers placing 4.1 orders each, compared to 649,000 customers placing 4.5 orders each in the same period a year ago. The average order value fell from $59.28 to $57.23 during this period while the average revenue per user declined from $265 to $236.
Venture investors include First Round Capital, SG Growth Partners and Bessemer Venture Partners. Blue Apron’s underwriters are Goldman Sachs Group Inc. (GS, Financial), Morgan Stanley (MS, Financial), Citigroup Inc. (C, Financial) and Barclays PLC (BCS, Financial).
Disclosure: I do not own any stocks mentioned in the article.
