What happened: Washington, D.C.-based fast-casual restaurant chain Cava ($CAVA) raised $318M from its IPO debut on NYSE. Cava's IPO is an unusual bright spot for a VC-backed startup amidst the shuttered IPO market. IPO listings for VC-backed startups dropped to 20 in Q1 2023, nearly a fifth of the peak quarterly values of 95 from Q3 2021. Relevance: The startup has 250 locations currently and intends to use the proceeds to open between 60 to 70 new outlets in 2023. The firm intends to keep its annual store growth at 15% going forward. Cava priced the shares at $22 per share, giving the firm a valuation of $2.45B. The valuation was higher than its $1.71B valuation from its last Series F equity funding round worth $170M from April 2021. The firm has raised $738M from VC backers to date. Notable shareholders include T. Rowe Price, SWan & Legend, and Revolution Growth, which own 17.4%, 11.6%, and 6.9% stakes in the firm, respectively. The firm reported $564.1M in revenue last year, up 12.8% YoY. Why it matters: Cava's successful IPO listing could spur VC-backed firms like Turo, Reddit, and Instacart to go public. |
