Reason to smile: Luminar founder and CEO Austin Russell, in a vehicle equipped with one of the lidar company’s test systems. The first-day performance of Luminar’s new stock issue made Russell one of the youngest people ever to attain billionaire status. [Image: Courtesy of Luminar]
On 3 December 2020, a bit more than three months after announcing its merger with the special-purpose acquisition company (SPAC) Gores Metroupolus Inc., the solid-state lidar developer Luminar Technologies made its debut on Wall Street in spectacular style. The company’s shares—trading publicly for the first time on the NASDAQ exchange, under the ticker symbol LAZR—ended their first trading day at a price of US$22.98 apiece as of 4:00 p.m. U.S. Eastern Time.
That was some 26% above the price fetched by shares of Gores Metroupolus, the predecessor stock to LAZR, only one day before. And the stock’s conspicuously successful maiden voyage made the company’s 25-year-old founder, Austin Russell, one of the youngest persons in history to attain billionaire status.
From GHMI to LAZR
Strictly speaking, Luminar entered the path to go public with its 24 August 2020 announcement of the merger with Gores Metropoulos, a SPAC sponsored by The Gores Group, a global investment firm. Such “blank check” companies are publicly traded shell companies formed specifically to invest in private firms and provide a less fraught, smoother road to public ownership than a traditional initial public offering (IPO).
Since the announcement, while the proposed business combination was undergoing shareholder approval, the SPAC shares, embodying the value of the combined companies, have traded on the NASDAQ under the Gores Metroupolos ticker symbol GMHI. On 2 December, the firm announced that the business combination had been officially completed, and that the LAZR stock, under the business name of Luminar Technologies, Inc., would succeed GHMI and begin trading on the following day.
Full-stack lidar provider
Luminar is one of a number of technology firms seeking to provide lidar systems to empower the long-promised era of fully autonomous vehicles (see “Lidar for Self-Driving Cars,” OPN, January 2018). The company’s core system involves a compact package combining a 1550-nm fiber laser source, an integrated InGaAs sensor and dual-axis scanning mirrors, married to proprietary perception software.
The company believes that this technology stack gives it a level of integration that allows it to provide a turnkey solution to automakers. It has already signed a widely publicized supply agreement to supply lidar units for Volvo consumer vehicles, starting in 2022, and also has inked partnership agreements with Daimler Truck and other partners.
Heady days
At the time of the merger announcement in August, the deal implied a pro forma enterprise value of US$2.9 billion and a market capitalization of US$3.4 billion for Luminar. Three and one-half months later, at the end of its first trading day as LAZR, the company’s market cap had reportedly ballooned to well in excess of US$7 billion.
In a press release marking the 2 December completion of the business combination, the day before LAZR stock began trading, Luminar CEO Russell called the event “an incredibly proud moment for the entire Luminar team and a milestone for the industry at large.” As the owner of about one-third of the outstanding shares of LAZR, Russell had additional reason for satisfaction one day later. According to Forbes, the stock’s spectacular first-day performance put Russell’s net worth at some US$2.4 billion.
That made Russell, at the age of 25, one of a handful of entrepreneurs who have amassed a billion-dollar fortune before the age of thirty. Interestingly (at least for those drawn to these sorts of comparisons), another oft-cited example—Mark Zuckerberg of Facebook—logged a net worth of “only” US$1.5 billion when he joined the 10-figure club in 2008, at age 23.