Warren Buffett backs software firm Snowflake before it doubles in value within minutes of its Wall Street stock market debut
Magic unicorn: Software firm Snowflake’s value soared over £50bn on its stock market debut
Wall Street sensation Snowflake more than doubled in value last night within minutes of its debut on the stock market.
The software firm is among several ‘unicorn’ tech outfits listing this year, and had priced shares at $120 under the ticker ‘Snow’, valuing it at £25billion.
But as trading began yesterday, the stock opened at $245 as eager investors piled in, sending its value over £50billion.
The float was already due to be the biggest in the US this year and the shares were suspended by regulators almost immediately, due to the volatility.
Based on the opening price, Snowflake would have a valuation bigger than delivery firm Fedex, defence giant Northrup Grumman or General Electric.
The bonanza came just a day after fintech firm Klarna was separately valued at £8billion in a fundraising round.
Klarna, which is also expected to list on the stock market, has gained rapid popularity for its ‘buy now, pay later’ service that allows online shoppers to pay for goods in instalments.
Other tech firms set to make their market debut include accommodation provider Airbnb, data firm Palantir and food delivery start-up Doordash.
California-based Snowflake’s technology helps big companies compile and analyse huge databases. Backers include Salesforce and Warren Buffett’s Berkshire Hathaway.
The float eclipses Royalty Pharma’s as the biggest of 2020, and underlines a rebound in US stock market listings after the pandemic prompted several companies to put their plans on ice.
Snowflake had been valued at $12billion (£9billion) in February. Revenue rose 174 per cent to £204million for the year to January 31, but its losses nearly doubled to £268million.