The Story of a Cap Table: Navan

Navan IPO Braves the Government Shutdown, With Mixed Results

The government shutdown has mostly frozen an IPO market that had just begun to come to life, but business travel platform Navan last week decided to take the plunge anyway.

With the absence of a functioning SEC adding a little regulatory risk, the debut was wobbly: Navan raised $923 million in the IPO, but after opening at $25 for an implied valuation of $6.2 billion, the shares closed down 20% on the day. It was also a down round from the company’s 2022 valuation of $9.2 billion. Currently, the stock price has fallen even further, to $17.22.

Navan was the first company to file for an IPO using a new SEC rule that allowed companies to get automatic approval for their documents 20 days after submitting their price range. However, the SEC can still scrutinize the filing after the fact and force the company to amend its statements. That risk likely led to the sell-off.

Still, it was a decent exit for Navan’s two earliest and largest shareholders, Lightspeed Venture Partners and the Israeli solo capitalist Oren Zeev, and a victory for almost everyone involved after the company suffered a near-death experience in 2020.

With 23.07% ownership, Lightspeed remained the largest shareholder at the Thursday debut, with just a small edge over Zeev Ventures’ 18.6% (Zeev also owned an additional 2.8% from which he invested out of a trust, but it is still below Lightspeed’s stake). At $20 a share by the end of the day, Lightspeed’s holdings were worth around $1 billion, while Zeev Ventures’ stake was worth $747 million. Andreessen Horowitz also owned a respectable 14.1%.

An additional big winner was Greenoaks, which basically saved the company with a $115 million convertible note in 2020, and ended up with a 7.1% stake and a 3x return on IPO day.

Navan isn’t yet profitable, with rolling 12-month revenue of $613 million (up 32%) and losses of $181.1 million, per the filing. At 73% gross margins, it’s not the best for a SaaS startup, but in the age of AI deals where you dream of breaking 60% on gross margins, Navan looks almost decent.

But beyond the share price, the story of Navan’s cap table is one of early venture bets combined with an unusual debt round, led by Greenoaks’s Neil Mehta. When the pandemic killed the travel industry it nearly