Black Rock Coffee Bar, an Arizona-based coffee company that operates 158 stores across seven states in the United States (US), has been valued at US$1.27 billion after its shares rose more than 30 per cent above their initial public offering (IPO) price.
Shares opened at about $26.50, as opposed to the offer price of $20. The stock closed at $27.53 on Friday.
Through the sale of 14.7 million shares, the company raised $294.1 million, with affiliates of Black Rock Coffee Bars four Co-Founders each holding more than five per cent ownership.
“Our baristas are our magic,” Black Rock Coffee CEO Mark Davis said in an interview. “We believe the value proposition we have and doubling down on that experience, it’s a giant point of difference and that’s what ultimately the investors saw as valuable and why they wanted to be a part of it.”
Black Rock has set itself the lofty goal of operating 1000 stores by 2035, with its recent IPO now placing it alongside publicly traded peers including Starbucks and Dutch Bros.
The company is confident in its ability to reach this goal and expects its future annual growth rate to be consistent with its historical average of 20 per cent from 2020 to 2024.
“We expect to favour growth in markets where we currently have a presence while also taking a disciplined and methodical approach to enter new markets where we anticipate successful expansion to achieve our growth goals,” states Black Rock’s SEC filing.
“We have the brand strength, offering, portable unit economics, people, culture, and infrastructure to support our long-term expansion across the country.”
Black Rock is the first coffee chain to go public in the US since Dutch Bros issued an IPO in 2021.
It was one of four companies to go public in New York on Friday, 12 September.
