Fortune: IPOX® VP Kat Liu Comments on Oura’s Postponed IPO and Valuation Questions

Fortune examines Oura’s decision to postpone its highly anticipated IPO shortly before pricing, despite reported strong investor demand and a proposed offering that could have raised as much as $2.2 billion. The article considers whether valuation concerns, the structure of the offering, competitive pressures in the wearables market, or broader market conditions contributed to the decision.

IPOX® Vice President Kat Liu provided perspective on the postponement and the questions surrounding Oura’s valuation. Liu noted that companies are unlikely to publicly attribute a withdrawn offering to unmet expectations and explained that investor views of Oura’s business model could materially affect how its proposed valuation is assessed.

The article also highlights the composition of Oura’s proposed offering, with 73% of the shares set to be sold by existing shareholders and 27% newly issued by the company. Liu pointed to the high proportion of secondary shares as a potential concern for investors because much of the offering’s proceeds would have gone to existing shareholders rather than supporting the company’s growth.

“What else are you gonna say? ‘We aren’t meeting our expectations.’ I mean, that’s just not a thing to say to the public,” Kat Liu told Fortune.

“If you are viewing Oura as an AI-enabled digital-health platform … then whatever multiple they are looking for can kind of be justified,” Liu said. “But if you are just looking at them as a pure ring manufacturer, just consumer hardware, then that valuation is pretty hefty.”

“That’s a flag for the market,” Liu said. “It’s signaling that this IPO is not meant for growth.”

Read the full article by Morgan Chittum on Fortune: Why Oura really pulled its IPO: Wall Street experts suspect valuation concerns, an insider cash-out, and an Apple-sized threat