Roblox Plans to Go Public Through Direct Listing

By Kimberly Chin

A month after shelving its plans to go public, videogame company Roblox Corp. said it raised $520 million and that it is planning a direct listing.

A direct listing allows companies to float their shares directly on the stock market, rather than going through the underwriting process typically associated with taking a company public. Data-mining firm Palantir Technologies Inc., streaming service Spotify Technology SA and workplace messaging platform Slack Technologies Inc. went public via direct listings.

A Series H funding round led by Altimeter Capital and Dragoneer Investment Group placed the company's shares at $45 apiece, bringing its valuation to a total of $29.5 billion. The company was valued at $4 billion following a $150 million raise in February 2020.

The Investment Group of Santa Barbara and Warner Music Group also participated in the funding round, as did several of its existing investors.

The company said the proceeds will go toward Roblox's growth initiatives and platform that will enable shared experiences among its billions of users.

Roblox was set to go public in December. part of a year-end rush of companies seeking to tap the red-hot market for initial public offerings. However, The Wall Street Journal reported on Dec. 11 that the company had delayed its offering after company officials decided that the high trading performance of Airbnb Inc. and DoorDash Inc. made it too difficult to determine the right price for the videogame company's shares.

San Mateo, Calif.-based Roblox, which was established in 2004, operates a free online platform that has millions of games created by its own players with tools the company provides.

It generates revenue by selling virtual currency to users called Robux for purchasing in-game perks such as virtual pets or accessories for customizing the look of their avatars. The company has benefited as the pandemic has supercharged demand for online gaming.

Write to Kimberly Chin at kimberly.chin@wsj.com

(END) Dow Jones Newswires

January 06, 2021 19:29 ET (00:29 GMT)

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