One person earned $250,000 on Airtasker last year. Now it’s listing

Recent technology floats have suffered after a vicious sell-off of growth shares. Will this one be any different?

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A familiar name on the smartphones of many younger generations will be floating on the ASX this month.

Airtasker Limited (ASX: ART) will start trading on Monday 22 March after an initial public offering of 65 cents per share. That’ll give it a market capitalisation of $255.4 million.

Airtasker allows users to post mainly domestic jobs, with “taskers” replying to complete the chore for a fee. 

Like many modern tech firms, there is a founder story behind the business. 

Co-founder and chief executive Tim Fung declined to speak to The Motley Fool, but he told that in 2011 he had to move house and asked for help from a friend who had a van.

He thought surely he wasn’t the only one in that situation.

“Why do we ask friends and family to do all these kinds of jobs when there’s so many people out there who are looking for work and opportunities?” he asked.

“We thought of the huge opportunities that we could unlock if we could make it really simple to be able to buy local services… About nine months after that, we launched.”

Recent tech IPOs not inspiring confidence

Airtasker’s name value may help it drive up initial demand for its shares.

But it’s been tough times for many of the other tech companies that have floated in the past few months.

The biggest example is Nuix Ltd (ASX: NXL), which listed in early December amid huge hype and some analysts calling it the IPO of the year.

The shares for the data analytics provider hit as high as $11.86 in January. But they tanked after the half-year results at the end of last month. The stock now goes for $4.93, which is 7% lower than the IPO price of $5.31.

Fintech Douugh Ltd (ASX: DOU) boasted the highest 2020 return of any IPO that year, but has since nosedived due to regulatory and performance concerns.

Online retailer Limited (ASX: MYD) floated for $1 in October then immediately thrilled the market, trading for as high as $2.20. As of Monday, it has dipped back below its IPO price, trading at 98 cents.

Value per task increasing

A typical Airtasker scenario is a person who just bought flat-pack furniture wanting to get someone else to assemble it for them.

But the average dollar value per task is increasing. 

It went from $97 in the company’s early days to $159 last financial year. The prospectus forecasts $189 by the end of the current year.

“What we’ve observed from that is that it’s actually the types of work that people are requesting through Airtasker that are increasing in complexity and sophistication.”

So there are now more professional tasks exchanged on the platform, such as legal or accounting work.

The highest earning tasker in 2020 earned about $250,000 through the platform.

Cynics have pointed out the ASX listing may be more of an exit ploy by long-time investors, rather than a genuine capital raise. For example, Seven West Media Ltd (ASX: SWM)’s investment arm is selling off its entire $46 million stake.

Airtasker copped a pro forma net loss after tax of $5.2 million for the 2020 financial year. It estimates losing $6.2 million for the current year.

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Returns as of 15th February 2021

Tony Yoo owns shares of Nuix Pty Ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Nuix Pty Ltd. The Motley Fool Australia has recommended Nuix Pty Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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