Shares of Boxed, the wholesale e-commerce grocery platform, popped on the first day of trading on Dec. 9. The company went public through a merger with blank-check company Seven Oaks Acquisition Corp. instead of a traditional IPO. How can you buy Boxed shares?
Previously, the Seven Oaks SPAC traded on Nasdaq under ticker symbols "SVOK," "SVOKU," and "SVOKW" until it merged with Boxed on Dec. 8. After the businesses combined, Boxed started trading on the NYSE under the new ticker symbols "BOXD" and "BOXD WS."
Within the first two hours of trading Dec. 9, Boxed shares jumped 43 percent to $12.97 per share. At 12:00 p.m. EST on Dec. 10, the shares were trading at $11.22.
By merging with the SPAC, Boxed will be able to raise about $198 million in gross cash proceeds from Seven Oaks’ about $78 million cash in trust and $120 million in private placement financing, the company said in a statement. Boxed has a valuation of about $900 million.
What is Boxed?
According to Forbes, Boxed is the “Costco for Millennials.” Forbes named the company one of its Next Billion-Dollar Startups in 2016. The retail e-commerce service provides consumables in bulk to businesses and individuals without requiring them to buy a membership like Costco, Sam’s Club, and other big-box bulk retailers do.
Boxed also offers mobile ordering and delivery to customers, which are both attractive to Millennials.
Boxed started in the garage of a New Jersey home.
As a child, Boxed co-founder and CEO Chieh Huang went to bulk retailer Price Club every other weekend with his parents. It was those visits that prompted him to start Boxed with a few friends in 2013. The company started operating out of Huang’s parent’s garage in New Jersey.
“I was basically trying to solve a problem that I myself have,” Huang told Forbes in 2016. “I grew up in the burbs, and every other weekend would go to the Price Club, and then I went to the city and didn’t have a car anymore. Am I just supposed to get ripped off?”
Currently, Boxed employs about 400 people. The average orders are about $100. The company projects 40 percent YoY growth in net revenue for 2022.
Boxed added software and services in 2021.
The company has also expanded its tech offerings and opened a software and services side of the business within the past year.
On the same day Boxed went public, the company announced a new partnership with Google Cloud to power its platform. The deepening relationship with Google Cloud will enhance operational capabilities, deliver more value to clients, and find new customers for its clients.
Huang told Yahoo Finance that Boxed is expected to earn “eight figures” in its first year of software sales.
The supply chain backup isn’t a concern for Boxed.
Although the company has some challenges finding employees, supply chain issues caused by the backup at ports aren’t as much of a concern. Huang told Yahoo Finance that most of the consumables that Boxed sells are made in the U.S.