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Asana Rises in First Day of Trading After NYSE Direct Listing

Collaboration-software company Asana reference-priced at $21 and opened at $27.
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Shares of Asana  (ASAN) - Get Asana, Inc. Class A Report rose Wednesday in their first day of trading for the collaboration-software company after its direct listing on the New York Stock Exchange.

The San Francisco company's co-founder and chief executive is Dustin Moskovitz, who also a co-founder of Facebook.  (FB) - Get Meta Platforms Inc. Class A Report

Asana recently traded at $28.49 on the NYSE, up 36% from its reference price of $21. The stock opened at $27.

In a direct listing a company and its current holders sell shares to the public. New shares are not created and no underwriters are involved.

Asana’s IPO was overshadowed by Palantir  (PLTR) - Get Palantir Technologies Inc. Class A Report, a provider of data-analytics software to the government. Backed by venture capital icon Peter Thiel, Palantir also went public Wednesday with a direct listing on the NYSE.

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Asana, started up in 2008, has 910 employees and produces software that competes with Atlassian’s TEAM Trello.

“We have experienced rapid growth in recent periods,” Asana said in its prospectus. Revenue registered $76.8 million and $142.6 million for fiscal 2019 and fiscal 2020, respectively, representing growth of 86%.”

Sales totaled $28 million and $47.7 million for the three months ended April 30, 2019 and 2020, respectively.

The company reported net losses of $50.9 million for fiscal 2019 and $118.6 million and fiscal 2020. It posted deficits of $15 million and $35.8 million for the three months ended April 30, 2019 and 2020, respectively.

As for risks, “we have a limited operating history at our current scale, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful,” Asana said.

In addition, it said, “we have a history of losses, and we may not be able to achieve profitability or, if achieved, sustain profitability.”