Online real estate platform Compass eyes $10 billion valuation in US IPO (COMP)

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The online real estate platform Compass is eyeing a $10 billion valuation in an IPO on the New York Stock Exchange, according to an amended S-1 Prospectus filed on Tuesday.

Compass is now set to offer 36 million Class A shares to the public between $23-$26, according to the filing. Compass filed its original S-1 Prospectus on March 1.

The SoftBank-backed online real estate platform and brokerage firm could raise up to $936 million if the amended IPO goes as planned. Goldman Sachs, Morgan Stanley, and Barclays are the lead underwriters for the IPO. Their over-allotment is an additional 5.4 million shares.

Compass has raised $1.5 billion from investors including SoftBank, Goldman Sachs, and Canada's Pension Plan Investment Board since its founding in 2012. 

The firm landed $450 million from SoftBank's Vision Fund back in 2017 with a $2.2 billion valuation. Then most recently, Compass was valued at $6.4 billion after a $370 million funding round in 2019.

Compass has done over $300 billion in gross transaction volume through its online real estate platform since 2012 while working with 19,000 real estate agents in the residential market across the country.

The company turned in $3.72 billion in revenue in 2020, up 56% year-over-year. Net losses also narrowed to $270 million last year from $388 million in 2019. 

Still, Compass' lack of profitability, relatively small market share, and other issues have some questioning whether the IPO is overhyped

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