Disco busts through IPO pricing estimate at $32 a share

eDiscovery vendor CS Disco, Inc. yesterday (20 July) announced the pricing of its initial public offering of 7,000,000 shares of its common stock at $32.00 per share. When Disco first set terms for the IPO in mid-July, the price was said to be between a range of $26 and $29 a share. The $32 is also above a lifted pricing range announced at the start of the week, when commentators such as MarketWatch observed that Disco could raise as much as $238.7 with a pricing range of between $30 and $31 a share.

The underwriters have been granted a 30 day option to purchase up to an additional 500,000 shares of common stock from DISCO and up to an additional 200,000 shares of common stock from shareholder Gabe Krambs.

DISCO provides a cloud-native, artificial intelligence-powered ediscovery, legal document review and case management for enterprises, law firms, legal services providers and governments.

The shares are expected to begin trading on the New York Stock Exchange on July 21, 2021 under the symbol “LAW” and the offering is expected to close on July 23, 2021, subject to customary closing conditions.

Disco, which was founded in 2013, has a revenue of $74m and a year-on-year growth of 37%. It says in the IPO prospectus that its estimated market size is $42bn.

Customers quoted in the S-1 include Accenture, Kutak Rock and US law firm Perkins Coie.

Disco is the latest legal tech vendor to file its S-1: in June Intapp publicly filed for its long-anticipated IPO. The Palo Alto-headquartered company intends to list its common stock on the Nasdaq Global Market under the ticker symbol “INTA.” And LegalZoom has said it intends to raise $488m from its IPO, which it filed for on 8 June.

J.P. Morgan Securities LLC and BofA Securities Inc. are acting as lead book-running managers and representatives of the underwriters for the offering. Citigroup Global Markets, Inc. and Jefferies LLC are also acting as book-running managers for the offering, and Canaccord Genuity LLC, Cowen and Company, LLC, Needham & Company LLC, Stifel, Nicolaus & Company, Incorporated and Loop Capital Markets LLC are acting as co-managers for the offering.