Tempus, a genomic testing and data analytics company launched by Groupon founder Eric Lefkosky, listed on the Nasdaq on Friday and rose about 15% in opening trade.
The company priced its IPO at $37 a share on Thursday, at the high end of its $35 to $37 price range, to raise nearly $411 million at a fully diluted valuation of more than $6 billion. But Tempus' last public private valuation was $8.1 billion, and PitchBook data estimates the company's valuation in the second half of 2022 at $10.25 billion.
Despite the steep discount from its previous valuation, the IPO is a feat for an unprofitable company at a time when it's considered a poor time to launch a public offering. Tempus has revenue of $531 million and a net loss of $290 million for 2023. But the company's operating losses are narrowing from 83% in 2022 to 37% in 2023, and Lefkosky told CNBC he expects Tempus to be cash flow and EBITDA positive in 2025.
Lefkofsky founded Tempus in 2015 after he noticed doctors not relying on data during his wife's breast cancer treatment. He wanted to start a company that would harness the technology and data gained from genome sequencing.
Tempus is currently positioning itself as an AI company, but AI will only account for $5.5 million, or about 1%, of revenue in 2023. The company said in its prospectus that its AI product line is still in its early stages, but that it intends to “embed AI, including generative AI,” into all aspects of its diagnostic tools.
Lefkofsky is by far the largest shareholder in the company. He owns 30.1% of the company, according to S1, and a dual share structure gives him 65% of the voting power. A company run by Kimberly Keywell, the ex-wife of Lefkofsky's longtime business partner Brad Keywell, owns 10.2% of Tempus. Scottish asset manager Baillie Gifford owns 5.9% of the company, worth $350 million at the IPO price.
Tempus' early investors included NEA, Revolution and T. Rowe Price. The company raised $200 million in Series G5 funding from SoftBank in April. Tempus is the fourth company to go public under Lefkofsky, who is best known as the founder of Groupon, which went public in 2011 at a valuation of nearly $13 billion but now trades for less than $600 million.
Tempus is the fourth company to go public for Mr. Lefkofsky, who is best known as the founder of Groupon, which went public in 2011 at a valuation of nearly $13 billion but now trades for less than $600 million.
