Is the Liquid Death IPO an Investment Opportunity?

liquid death

Considering investing in Liquid Death? Scheduled for an early 2024 IPO, with Goldman Sachs managing, this public offering could be a notable addition to the stock market. This article outlines the key considerations for potential investors—timeframes, investment prospects, and the possible impact of this unique brand’s public entry.

Key Takeaways

  • Liquid Death is preparing for an IPO in early 2024 with Goldman Sachs managing the launch, reflecting significant investor interest in the company’s progression from a private cult favorite to a publicly traded entity.

  • Pre-IPO investment opportunities in Liquid Death require being an accredited investor with access to secondary markets, carrying risks such as lack of liquidity and a long-term commitment to the investment.

  • Liquid Death’s financial robustness, marked by a $1.4 billion valuation and significant annual sales growth, and strategic expansions through partnerships and wide distribution networks, are key indicators of the company’s potential for a successful public offering and future profitability.

Exploring the Liquid Death IPO Wave

Liquid Death is causing ripples that could soon turn into a wave of investment opportunities. The anticipated initial public offering (IPO) of Liquid Death is expected to hit the market in early 2024, marking a significant milestone for the company.

Investors are eagerly watching the calendar for spring 2024, when Liquid Death could make its splash on the public market.

What is an IPO?

For those unfamiliar with the jargon, an IPO is a transformative moment for any private company. It’s when the company opens up ownership to the public, allowing anyone to buy shares and claim a piece of the pie. This initial public offering is more than just a fundraising event; it’s a company’s grand debut on the stock market stage, setting the scene for new investment horizons and a potential reshaping of its future.

Liquid Death’s IPO Aspirations

While Liquid Death has yet to officially announce its IPO, whispers of Goldman Sachs’ involvement suggest that this potential IPO is more than just market murmurs. It’s a strategic move that could see Liquid Death transition from a cult favorite to a publicly traded powerhouse, offering a chance for investors to buy pre-IPO shares and potentially reap the benefits of the company’s growth strategy.

Can we expect Liquid Death to go public? The signs point to yes, and the anticipation is palpable.

Navigating the Waters of Pre-IPO Investment

Before a company goes public, there’s a sea of investment opportunities that can be both lucrative and treacherous. For Liquid Death, a privately held company as of late 2023, buying pre-IPO shares means navigating the less-charted waters of secondary markets. These platforms are where investors can dip their toes in the company’s growth story before it hits the broader market.

However, this journey requires a keen eye for detail and a thorough analysis of the company’s financial health, market competition, and the company’s growth strategy.

The Path to Owning Pre-IPO Shares

If the idea of investing in Liquid Death before its IPO is enticing, know that it’s an exclusive club. You need to be an accredited investor to buy pre-IPO shares. Platforms like EquityZen or Forge Global are the gateways to these golden tickets, offering a chance to get in on the ground floor. But remember, at this stage, Liquid Death isn’t a publicly traded company, so these shares come with a different set of rules and expectations.

Evaluating the Risks

Investing in pre-IPO shares isn’t without its risks. One of the biggest is liquidity—or rather, the lack of it. Since pre-IPO shares of companies like Liquid Death aren’t traded on public exchanges, they can’t be sold as easily as stocks listed on the NYSE or Nasdaq. This means that your investment is more of a long-haul commitment, with the potential for high returns tempered by a higher risk profile.

Liquid Death’s Market Splash

Liquid Death has carved out a niche in the beverage market that’s hard to ignore. With retail sales soaring to $263 million in 2023, the brand’s triple-digit growth for three consecutive years is nothing short of remarkable.

Their unique branding and flavors have resonated within a multi-category brand, and their widespread distribution network has solidified their market presence.

The beverage industry has been riding a wave of sustainability and diversification, and Liquid Death has been surfing this wave with style. With eco-friendly aluminum cans as a response to plastic pollution, they offer a variety of products including:

  • still water

  • carbonated water

  • flavored waters

  • iced tea

They’ve catered to current consumer trends and preferences. The brand’s new flavors have not only met but exceeded expectations, contributing significantly to its growth under the leadership of CEO Mike Cessario, who has steered the company to become a leading brand in its category.

Liquid Death’s Brand Impact

From its inception, Liquid Death has embraced an unconventional marketing approach that has captivated a youthful demographic. Their branding, which echoes the energy drink aesthetic, and their alignment with subcultures like punk and metal, have propelled the brand to rapid growth. With a strong social media presence and celebrity investors, Liquid Death has not only talked the talk but walked the walk, becoming the fastest-selling water at Whole Foods Market and turning heads with their bold marketing strategies.

The Financial Hydration Behind Liquid Death

Liquid Death isn’t just making a splash with its branding; its financials are equally impressive. Here are some key highlights:

  • A recent funding round swelled the company’s coffers by $67 million

  • The company’s valuation is now at a staggering $1.4 billion

  • Annual sales have surpassed the $200 million mark

  • The company has implemented strategic cost-reduction measures to sharpen its competitive edge

  • The stage is set for a successful IPO

Recent Funding Round Success

The company’s financial prowess was evident in its last funding round, which raised a robust $67 million. This infusion of new capital boosted Liquid Death’s valuation to $1.4 billion, a testament to the confidence investors have in its potential. With contributions from sectors far and wide, including names like Live Nation Entertainment, this funding round underscored the brand’s burgeoning appeal and set a new benchmark from its $700 million valuation in 2022.

YearFunding RoundAmount Raised
2019Seed Funding$1.6 million
2020Series A$9 million
2020Series B$23 million
2023New Funding$67 million

Profitability Projections

Profitability is the promised land for any company, and Liquid Death is on track to reach it by 2024. Here are some key points:

  • The company plans to slash ocean freight costs from 47% to 21%

  • The goal is a zero ocean freight future

  • Domestic shipping will make up just 11% of total expenses

With these aggressive cost-cutting measures, Liquid Death is not just aiming for profitability; it’s aiming to crack the top ten largest bottled water companies, making it a competitive beverage company.

Liquid Death’s Strategic Partnerships and Distribution

Strategic partnerships and a robust distribution network are the twin engines powering Liquid Death’s expansion. The company’s products have found their way into a myriad of retail outlets, including:

  • Convenience stores

  • Grocery shops

  • Bars

  • Nightclubs

The recent funding round was not just about raising capital; it was about cementing relationships with key distributors to strengthen Liquid Death’s retail presence and drive further market penetration.

Expanding Reach Through Partnerships

Liquid Death’s strategic partnership with Live Nation Entertainment is a masterstroke in marketing, placing its products in front of approximately 100 million fans annually at over 120 venues and festivals across the United States. This exclusive deal is more than a distribution agreement; it’s a cultural alignment with the music industry that amplifies the brand’s reach and resonance with its core demographic.

The company’s creativity doesn’t stop there; collaborations on products like skateboard decks with Tony Hawk’s blood have captured the imagination of a broader audience.

Distribution Channels

The distribution channels for Liquid Death are as varied as the flavors they offer. A successful retail test with 7-Eleven helped the brand outperform other premium water brands in Detroit, demonstrating the demand for their products. By engaging with distributors, Liquid Death has made its way into new settings, such as liquor stores and bars, further solidifying its market presence.

The brand’s reach now extends to over 113,000 retail outlets in the US and UK, a testament to its distribution prowess and the sales figures that underscore its success for the average person.

The Leadership Fountain: CEO Mike Cessario

Behind every great brand is a visionary leader, and for Liquid Death, that leader is none other than the Liquid Death Chief Executive Officer and Cofounder Mike Cessario. With roots in the music scene and a background in advertising, Cessario’s creative flair and entrepreneurial spirit have been pivotal in shaping the brand’s identity. His approach to marketing has been unorthodox yet wildly successful, drawing inspiration from figures like Michael Dubin of Dollar Shave Club and Yvon Chouinard of Patagonia. Cessario’s persistence and resourcefulness have been key to overcoming challenges, such as securing canning capabilities, which have positioned Liquid Death for rapid growth.

Cessario’s influence on Liquid Death’s trajectory is undeniable. His strategy of low-budget, high-impact promotional materials and leveraging negative feedback as a marketing tool have proven effective in capturing market attention. As the holder of a likely 10% stake in the company, his decisions carry weight, especially when it comes to pivotal moves like pursuing an IPO. Cessario’s focus on growth and margin improvement is a driving force behind the company’s success and investor confidence.

Summary

Liquid Death is more than a company selling canned water; it’s a brand that has redefined an industry and captivated an audience with its unapologetic style and aggressive growth strategy. From its daring marketing to its strategic partnerships and financial milestones, Liquid Death stands as a testament to what a company can achieve with the right leadership and vision. For investors looking for a refreshing opportunity, this could very well be the next big wave to ride.

Frequently Asked Questions

Where is Liquid Death’s headquarters?

Liquid Death’s headquarters are in Los Angeles, California.

Is Liquid Death a successful company?

Yes, Liquid Death is a successful company, with its products being sold in 60,000 stores across the United States and achieving top-selling status on Amazon.

Who co-owns Liquid Death?

Cessario co-owns Liquid Death with co-founders like Michael Dubin and Biz Stone.

When is Liquid Death’s IPO expected to take place?

Liquid Death’s IPO is expected to take place in early 2024, likely in the spring.

How has Liquid Death made an impact on the beverage market?

Liquid Death has made a significant impact on the beverage market by expanding distribution channels, rapidly growing its market share, and establishing a unique brand identity.

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