Roblox Delays I.P.O. Until Next Year

Roblox, a gaming company that had been preparing to go public this month, has decided to delay its initial public offering until next year, in a sign that the enthusiastic market for I.P.O.s by DoorDash and Airbnb this past week has made it difficult to price shares accurately.

The company’s co-founder and chief executive, David Baszucki, announced the decision in a memo to employees on Friday, saying that waiting provided “an opportunity to improve our specific process for employees, shareholders and future investors both big and small.”

DoorDash, the country’s largest food-delivery company, started trading Wednesday with an I.P.O. price of $102, but ended the day up 86 percent, closing at $189.51 per share. The next day, Airbnb, a home rental company, rose 113 percent on its first day of trading, from $68 to $144.71 per share.

A slew of companies have rushed to go public before the end of the year. But the head-turning results have raised concerns about a new stock market bubble and prompted questions about whether the valuations of the unprofitable start-ups were divorced from reality.

With much of the world stuck indoors during the coronavirus pandemic, people have flocked to companies that help them work remotely, deliver food and other products, and provide online entertainment. It’s unclear, however, if those companies will be able to sustain the same level of interest when the world returns to normal.

The news of the Roblox delay was first reported by The Wall Street Journal.

Roblox has exploded in popularity since the beginning of the pandemic, especially among children. In an offering prospectus last month, it said it averaged 31.1 million daily active users in the first nine months of 2020, up 82 percent from a year earlier, but had lost $203 million in the same period. Inside the Roblox online universe, players’ avatars can interact and play millions of unique games set in different worlds, from tropical islands to haunted castles. Players pay money for premium memberships, as well as for items and clothing for their avatars.

source: nytimes.com