True Car Registers for IPOFriday, April 4, 2014
Santa Monica’s booming auto shopping website TrueCar has registered for an initial public offering with the Securities and Exchange Commission, seeking to raise up to $125 million.
TrueCar, which analyzes sales data to help consumers find a fair price for a car, reported 2013 revenue of $134 million, up roughly 60 percent from the almost $80 million it reported in 2012, according to its filing. While the company has experienced rapid revenue growth over the past five years – making the Business Journal’s list of Fastest Growing Private Companies four years in a row – its profit picture has been inconsistent.
TrueCar reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $2.1 million last year, compared to a loss of $46.5 million the year earlier and a loss of $3.5 million in 2011. It had adjusted EBITDA of $1.7 million in 2010.
Goldman Sachs & Co. and J.P. Morgan Securities will act as the offering’s underwriters, confirming a November report by Bloomberg News that the company had retained the firms as it considered going public.
True Car raised $30 million from Paul Allen’s Vulcan Capital in December after the IPO rumors surfaced. Vulcan has a 9 percent stake in the business. A September 2011 funding round raked in $200 million from investors including Century City’s UpFront Ventures, which the SEC filing shows has a 15 percent stake.
Other significant shareholders include entities associated with the United Services Automobile Association (with a 26.1 percent stake); Capricorn Investment Group, which invests for billionaire Jeff Skoll (16 percent); and founder and Chief Executive Scott Painter (12 percent).
Sameet Sinha, a senior analyst covering Internet companies at investment bank B. Riley & Co.’s San Francisco office, said in December that the market was particularly receptive to tech IPOs.
“The climate for IPOs is pretty strong,” he said. “We’ve had some failures, but some nice IPOs like Twitter. You can expect to get unprecedented valuations for a strong company’s IPO right now.”
The number of shares to be offered and the price range for the proposed offering have not yet been determined.
Painter declined comment through a spokeswoman.
The company currently has 342 full-time employees at offices in Santa Monica, Santa Barbara, San Francisco and Austin, Texas.