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SentinelOne raises $928M by selling 32M shares. The company is aiming for a $7B valuation in an IPO

A Regulatory Filing shows that SentinelOne Inc. is a Cybersecurity company owned by Third Point, a hedge-fund managed by billionaire investor Daniel Loeb. SentinelOne intends to raise $7 billion through its American Initial Public Offering.

SentinelOne plans to sell 32,000,000 shares at prices between $26 and $29 per share to raise $928million at the high end. Insight Venture Partners, Sequoia Capital and Tiger Global are also investors in SentinelOne’s venture capital fund.

The IPO frenzy is being fuelled by sky-high stock market valuations, which were inflated during the COVID-19 crisis’s low interest rates and monetary stimulus. This has created a surge in speculative excitement, which benefits both ordinary public companies and special purpose acquisition corporations (SPACs), established to raise capital via initial public offerings (IPOs).

SentinelOne was founded in 2013 and protects cell phones and computers from security breaches by monitoring corporate networks for suspicious activity using artificial intelligence technology. It saw an increase in sales during the COVID-19 pandemic. The majority of its employees began working remotely.

In November, investors including Sequoia and Tiger Global raised $267 million for the Mountain View, California-based company. This equated to a valuation of over $3 billion, almost three times its value in February 2020.

SentinelOne reported in its filing that several shares have been purchased by organizations linked to Tiger Global and Insight Venture Partners, Third Point Ventures and Sequoia Capital for an estimated total of $50 million.

Wall Street’s record-breaking streak in stock market floatations continues with the announcement of SentinelOne’s IPO plans. According to Dealogic statistics, $171 billion has been raised by U.S. IPOs in the last half of the year, exceeding the $168 billion mark set in 2020.

Dealogic reports that the average gain in the first day of U.S. IPOs is 21.7 percent in 2019, and 28.2 in 2020. The average return for 2021 is 35.7%, compared to 32.29% in 2020 and 25.5% in 2019.

SentinelOne stock will be listed on the New York Stock Exchange under the letter S. The main underwriters of this offering are Morgan Stanley and Goldman Sachs & Co.

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