Vancouver’s Thinkific Labs has closed its previously announced initial public offering (IPO) on the Toronto Stock Exchange (TSX), raising more than $160 million CAD in gross proceeds.
The course creation platform sold 12,310,000 subordinate voting shares at a price of $13 per share, for estimated net proceeds of approximately $152 million.
Thinkific, which initially filed to go public just over a month ago, began trading on the TSX today under the symbol ‘THNC.’ According to Thinkific’s final prospectus, the company decided to go public to improve awareness of its brand, increase the company’s financial flexibility, and facilitate future access to public capital markets.
Thinkific plans to use the proceeds from its IPO to invest in sales and marketing and develop its platform.
The software-as-a-service firm plans to use the proceeds from its IPO to invest in sales and marketing, develop its platform, and strengthen its balance sheet in order to pursue unspecified “future opportunities.”
Founded in 2012 by CEO Greg Smith, COO Miranda Lievers, CTO Matt Payne, and Chief Strategy Officer Matt Smith, Thinkific offers cloud-based software that helps entrepreneurs and businesses launch, grow, and diversify their businesses by creating and selling online courses and other learning products through its platform.
The online course creation company has experienced significant growth over the past few years, especially during COVID-19. For the fiscal year that ended on December 31, 2020, Thinkific recorded $21.07 million USD in revenue and a net loss of $1.29 million, according to its preliminary prospectus. This revenue was more than double its 2019 total of $9.8 million and more than triple its 2018 total of $6 million.
BMO Capital Markets and CIBC Capital Markets acted as joint bookrunners and co-lead underwriters for the IPO, on behalf of a syndicate of underwriters that included National Bank Financial, TD Securities, Cannacord Genuity Corp, Cormark Securities, and Stifel Nicolaus Canada.
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The underwriters have been granted an over-allotment option to purchase up to an additional 1,846,500 subordinate voting shares at a price of $13 per share. This option, which can be exercised within the next 30 days, could generate additional gross proceeds of up to $24 million and raise Thinkific’s net proceeds to an estimated $174.5 million.
Thinkific is backed by Rhino Ventures, which, through Rhino Co-Invest 2 Limited Partners, planned to buy approximately $25 million subordinate voting shares through the offering, according to Thinkific’s final prospectus. After the IPO, Rhino Group, along with Greg and Matt Smith own a total of 57 million multiple voting shares, accounting for 79 percent of Thinkific’s outstanding shares, and 97 percent voting power.
In December, Thinkific surpassed 100 million total course enrolments on its platform, serving customers across 165 different countries. To date, Thinkific claims it has helped over 50,000 entrepreneurs and businesses earn over $650 million through online courses.
Last fall, Thinkific raised $22 million CAD in growth financing, which it has used to accelerate its product innovation, bringing its total pre-IPO funding to $25 million.
Photo of Thinkific co-founders COO Miranda Lievers and CEO Greg Smith, courtesy of Thinkific