The Turo IPO may be around the corner in 2023. Learn about the potential for Turo hosts and guests to invest in Turo stock leading up to the initial public offering.
Bottom Line Upfront (BLUF)
Turo filed Form S-1 with the Securities and Exchange Commission (SEC) confidentially in August 2021. The document became publicly viewable in January 2022 to kick off the IPO process.
Market volatility in 2022 caused IPO volume to crash, prompting Turo not to proceed.
However, the company has continued to update its SEC filings instead of withdrawing, indicating it may complete its IPO in 2023 or when market conditions improve.
You can access all of the SEC filings in this article.
The latest SEC filing lacks essential details that will be provided when the company is ready to move forward.
The Turo IPO date is currently to be determined (TBD).
Information provided in the SEC filing indicates the company will offer up to 5% of IPO shares to “eligible” hosts and guests through the Turo Directed Share Program.
Underwriters will clarify eligibility in a future filing (this article provides the latest information in the Directed Share Program section below).
We expect Turo to partner with an online broker such as Robinhood or SoFi to allocate IPO shares to hosts and guests. If the number of shares permits, additional shares may be made available to retail investors at the administrating broker. Amended S-1 filings will state this if it happens.
As the lead underwriter, Morgan Stanley may choose to administer the IPO access to hosts and guests themselves.
We’ve seen similar IPO share distributions to customers in the past.
- Uber offered IPO shares to its most accomplished driver.
- Airbnb offered IPO shares to its hosts (but not its guests).
- Robinhood offered IPO shares to all of its customers.
Should hosts and guests invest in the Turo IPO? This article explores this decision.
What is Turo?
Turo is the world’s largest car sharing marketplace. It’s like Airbnb for cars.
The platform enables “hosts” (car owners) to turn their idle cars into income-producing assets by renting them to “guests”.
Guests typically rent cars for excursions, test drives, local day trips, or short-term getaways.
More than 160,000 hosts, 300,000 vehicles, and 2.7 million guests are active on Turo as of late 2022.
Turo believes it is fueling multiple seismic consumer behavior shifts that represent a long-term opportunity.
- Entrepreneurs seek income from idle assets
- Consumers prefer mobile-first services
- Cars are expensive, and many consumers don’t want to own them
Originally incorporated as RelayRides in August 2009, the company changed its name to Turo in 2016.
Turo is based in San Francisco, CA.
Here’s a Turo promotional video highlighting a couple renting a Rivian electric truck for a camping getaway:
Is Turo Publicly Traded Yet?
What is the Turo IPO Date?
The Turo IPO date is still TBD.
The author will update this section when news becomes available.
Turo Stock Symbol
The Turo stock symbol will be TURO.
What is the Turo Stock Price?
The underwriters will determine the Turo stock price as the IPO date approaches.
Underwriters gauge investor demand and release a stock price range in an amended S-1 filing leading up to the IPO.
Investors can use the range to determine investment suitability.
The night before the Turo IPO, the underwriters will finalize the Turo IPO price, and the stock will open for trading the next day.
What time will the Turo IPO start trading?
IPOs typically begin trading in the late morning to early afternoon.
Approximately 11am-1pm EST.
The precise timing depends on how long it takes the underwriters to perform “price discovery” to determine the opening trade price.
The opening trade price is different than the IPO price. Successful IPOs aim for an opening trade above the IPO so that IPO investors can benefit from the immediate price surge.
Turo S-1 Filings
Turo has submitted an amended S-1 SEC filings four times.
Here’s a link to all Turo SEC filings or view the latest below.
The latest S-1 filing was released to the public on December 14th, 2022. Read the latest Turo S-1 Filing below:
S-1 filings are required reading for IPO investors. Review the filing and all amended versions before proceeding with an investment.
Turo Directed Share Program
Information provided in the SEC filing indicates the company will offer up to 5% of IPO shares to “eligible” hosts and guests through a Turo Directed Share Program.
That means hosts and guests can invest in the IPO by acquiring shares the evening before the IPO and participating in any gains or losses during the first day of trading.
Here is the exact wording quoted from the December 2022 SEC S-1 filing. As the IPO approaches, underwriters will update the filing with more specific information (filling in the red blanks).
At our request, the underwriters have reserved up to 5% of the shares of common stock offered by this prospectus for sale at the initial public offering price to eligible hosts and guests in good standing on our platform and certain individuals identified by our officers and directors. Eligible hosts consist of hosts who have met the performance criteria to become All-Star Hosts, reside in the United States or United Kingdom, had, between [TBD] and [TBD], completed a trip as a host, and as of [TBA DATE], had at least 95% of rated trips earn five stars. Eligible guests consist of guests who have met the criteria for our Insider Rewards program, reside in the United States, and had, between [TBD] and [TBD], completed a trip as a guest.
The offering of a Directed Share Program is not an entitlement. Eligible hosts and guests may be able to participate, but a share allocation is not guaranteed.
How to Buy Turo Stock During the Turo IPO Directed Share Program
Buying IPO stocks as a customer or user of the company’s platform requires close attention to the instructions provided.
Consider investing in the Turo Directed Share Program as a privilege. You are not entitled to participate, and you have no obligation to participate.
You must follow the instructions provided when the next communication arrives.
Step 1: Monitor Turo IPO News
The first step is to monitor Turo SEC filings and business news to know when the Turo IPO process is underway.
The initial and amended filings indicate the IPO is on the way, but the date is still unknown (I’ll update this article when we learn more).
Monitor recent S-1 filings for updated Turo documentation, or set Google news alerts to be delivered to your inbox.
Read the S-1 filings as soon as possible to determine if you want to invest.
Step 2: Monitor and Read Emails from Turo
Once the IPO process is in motion, eligible hosts and guests will receive a timely email that details the instructions to invest in the Turo IPO.
Carefully read the instructions immediately.
If you decide to invest, your accurate compliance with the instructions is crucial.
Follow the instructions exactly as described, and perform tasks as soon as possible, well before any deadlines.
The process will move fast. You may only have days or hours to decide to participate and comply with instructions.
That’s why you should have already read the S-1 filing and decided whether to invest or not.
Step 3: Open an Account and Comply with the Instructions
The IPO investing instructions will include opening an account with the administering broker if you still need one.
Only one broker will likely administer the Directed Share Program.
The instructions will ask how much you want to invest based on the Turo stock price range.
Indicate the investment amount you wish to invest and deposit funds to cover that amount when instructed.
Not timely funding your account may disqualify you from participation.
Underwriters will disclose the final IPO price the evening before the IPO. If the price is outside of the initial stock price range, investors must reconfirm their intent to invest.
Step 4: Confirm
When the final IPO price falls outside of the initial price range (above or below), investors must confirm they are still interested in investing in the IPO.
For example, if the IPO price range is $12-$14, but the final IPO price is $17. Since the price is higher than first expected, the underwriters will ask investors to verify investor intent at the new price.
The administering broker will provide specific instructions on how to confirm your intent to invest. You must complete this request during a brief window, usually the evening before the IPO.
You must complete this step to receive an allocation.
Step 5: Receive Shares
If the investor decides to invest and follows the instructions carefully, they will be eligible to receive a share allocation.
Investors are not entitled to shares, so there is no guarantee you will receive an allocation or the total number of shares requested.
If you receive an allocation, the shares will appear in the account that you opened. Your ability to sell shares upon the stock opening for trading may be limited for a period of time up to one month.
Once underwriters deposit the shares into the account, you can transfer them elsewhere if desired.
When the IPO is complete, your shares are the same as those trading on the stock market.
Accessing Turo Stock Pre-IPO
If market conditions continue to deter Turo from going public, the company may withdraw its IPO filings.
This may frustrate early investors and employees who own stock, and they may look toward pre-IPO investing platforms to liquidate shares.
Pre-IPO investing platforms offer a secondary market for investing in private companies.
Employees with stock options who leave the company can look to a platform such as Equitybee to exercise options.
Equitybee provides accredited investors access to pre-IPO startups by funding employee stock options. In exchange, investors gain a portion of the future stock value.
Other pre-IPO platforms, such as EquityZen, ForgeGlobal, and Linqto, facilitate share transactions between equity owners and accredited investors.
Interested investors can open a free account with these platforms to monitor share availability. However, only accredited investors can participate.
Who Owns Turo?
Turo is a venture-backed biotech startup. It has raised about $500 million in private funding.
The latest transparent funding round was a Series E led by Manhattan Venture Partners and Allen & Company, completed in February 2020.
A $35 million round was also completed in April 2022, but details and participants are unclear.
Prominent venture capital investors joining Manhattan Venture Partners and Allen & Company include American Express Ventures, Canaan Partners, Daimler, GV, General Motors Ventures, Kleiner Perkins Caufield & Byers, Liberty Mutual Strategic Ventures, MassChallenge, Norwest Venture Partners, SK Group, Shasta Ventures, Trinity Ventures, football star Larry Fitzgerald, and rapper 2 Chainz.
The Series E round completed in February set the Turo valuation at about $1.1 billion, making it an official unicorn.
Startups typically raise funds at least every two years. The April 2022 round of $35 million may sustain the company until the IPO.
If the company is profitable, it may not need to raise funds through the IPO and could opt for a direct listing.
Should Hosts and Guests Participate in the Turo IPO?
Companies that thrive due to loyal customers sometimes offer IPO shares as a thank-you.
Airbnb, Uber, and Robinhood have done this in the past.
Investing in the Turo IPO as a host or guest is a personal decision. Refrain from relying on investment gurus or social media to make your decision.
Hosts and guests know the Turo platform better than most Wall Street investors. Therefore, hosts and guests may have a leg up on most analysts.
You know how the platform works and the growth potential of car sharing.
Read the S-1 filing thoroughly to understand the financials and risks. Avoid overpriced IPOs.
But also use your experience with the company as a determining factor.
I do not recommend trading IPOs.
But if you have at least a three to five-year investment horizon and believe that Turo stock has the potential to keep growing, consider the investment against your specific investment objectives.
Only invest money in the Turo IPO you can afford to lose.
* Disclosure: The web page contains affiliate links from our partners. If a reader opens an account or buys a service from a link in this article, we may be compensated at no additional cost to the reader. Opening an account with a broker that provides access to IPOs does not guarantee the customer allocations of specific IPOs. The author is long HOOD and ABNB.
Featured photo courtesy of Turo.