Eric Lefkofsky is aware of the general public itemizing rodeo effectively and is about to enter it for a fourth time. The serial entrepreneur, whose web value is estimated at almost $4 billion, has already taken three companies he’s based public. 

At present he’s the founding father of Tempus, a genomic testing and knowledge evaluation firm making ready to IPO. However he’s finest referred to as the co-founder of each day offers pioneer Groupon, which went public at a valuation of almost $13 billion in 2011, in certainly one of that yr’s most high-profile debuts. 

Groupon’s IPO and post-IPO years had been infamously troubled, although the general public listings of his different two firms — InnerWorkings in 2006 and Echo World Logistics in 2009 — didn’t elevate important flags for traders and did effectively for Lefkofsky. InnerWorkings, a provide chain startup he based in 2001, offered to personal fairness in 2021 for a fraction of its IPO market cap.

In the meantime, the inventory of Echo World Logistics appreciated steadily throughout its 11-year public life historical past earlier than additionally being offered to personal fairness at a 50% premium over its final buying and selling value in 2021. 

Among the controversies with Groupon concerned a report that Lefkofsky pocketed over $300 million from Groupon’s pre-IPO spherical, leaving little working capital for the corporate, and reducing its reported income in about half in revised S-1 filings after regulators scrutinized the financials in its preliminary S-1. That unorthodox determination has additionally delivered to gentle one other deal from his previous. He offered his dot-com-era firm Starbelly.com in 2000 to a 50-year-old firm; a yr later, that firm filed for chapter, in accordance with some experiences.

All of this has given Lefkofsky the status of getting considerably of a golden contact, at the very least for himself, however perhaps not for long-term traders of his firms. 

With Tempus, Lefkofsky is taking one other shot at making a long-lasting, beneficial firm. It was reportedly his spouse’s profitable breast most cancers therapy that led him to discovered Tempus in 2015.

“I used to be perplexed at how little knowledge was part of her care,” he instructed Forbes final yr. “I turned fixated with this concept that there was all this know-how that had been created for different industries that may very well be utilized to most cancers care and assist physicians make data-driven choices.”

He stepped down from Groupon’s CEO position in 2015, when the corporate’s worth had fallen to $2.6 billion. (Groupon’s market cap at the moment is round $600 million.) At the moment, Lefkofsky targeted his consideration on an early-stage enterprise agency, Lightbank.

Curiously, the Tempus S-1 submitting says that he’s taken no wage for the previous two years (the S-1 didn’t present greater than two years’ value of govt compensation for any named officer). Nonetheless, the submitting additionally stated that he’s as a result of be paid $800,000 and an $800,000 bonus beginning in 2025. And, though he wasn’t drawing a wage, he was paid a $5.3 million dividend from firm inventory this yr, the prospectus exhibits. The submitting additionally confirmed that Tempus has additionally lined the price of $7.5 million value of most well-liked shares issued to him and has paid $200,000 for his non-public airplane bills.

Tempus’ revenues had been $531 million in 2023, a 66% development from $321 million in 2022. However the firm remains to be hemorrhaging plenty of money, with web losses of $290 million (in 2023) and $214 million (in 2022). Though, the silver lining in its financials is that working loss margin has shrunk from 83% in 2022 to 37% in 2023, in accordance with the S-1 submitting.

Moreover, Tempus has an settlement with Pathos AI, one other firm Lefkofsky based. Pathos AI is a drug discovery platform based in 2020. Pathos pays Tempus for a proper to license its knowledge. In the meantime, Tempus’ COO, Ryan Fukushima, serves as Pathos’ CEO and splits his time between the 2 firms.

There are different indications that Lefkofsky is exercising extra energy at Tempus than is customary.

Whereas Tempus has not but stuffed out its principal stockholder’s chart, revealing solely that Lefkofsky is amongst them and owns at the very least 5% of the corporate, the billionaire clearly needs to protect full management of the corporate after it goes public. Tempus has granted his shares a whopping 30 votes per share. Tremendous voting shares aren’t uncommon, however 10 votes per share is extra frequent, with 20 votes thought of excessive. So that is an unusually excessive shareholder affect for a CEO of a healthcare firm, and we’ll must see whether it is decreased in future S-1s, indicating whether or not potential traders have balked at it.

But, Tempus’s S-1 will not be exaggerating how important Lefkofsky is to the way forward for the corporate. A healthcare VC investing in firms in genomics and knowledge evaluation has instructed everydayai that Tempus wouldn’t have grown to its dimension, nor garnered a lot capital with out Lefkofsky’s advertising and fundraising abilities.

Tempus raised $1.42 billion in funding from traders, together with his agency Lightbank, in addition to from NEA, Revolution Progress, T. Rowe Value, Novo Holdings, Franklin Templeton and Baillie Gifford. The corporate was final valued at $8.1 billion in October 2022. Tempus’ S-1 submitting additionally revealed that it not too long ago acquired $200 million from SoftBank.

No matter how a lot capital Tempus raises in its IPO, the corporate’s prospectus made it clear that it’s nonetheless removed from breakeven and can want “to lift extra capital sooner or later.” Whereas most unprofitable firms usually embrace this element of their prospectuses, it’s probably that traders will count on Tempus to have a follow-on public providing sooner or later, which may very well be a drag on their share value.

Tempus can also be making an attempt to place itself as an AI firm regardless that AI income accounted for under $5.5 million of income, roughly 1% of complete income in 2023. 

“I see Tempus playing on their development and ripe timing for AI throughout life sciences, however I don’t suppose the corporate has confirmed that but with their present providing,” the healthcare investor stated.

The corporate stated in its S-1 submitting that whereas its “AI product line is nascent, it plans to embed AI, together with generative AI, in each side of its diagnostic instruments.” Tempus declined to remark past what’s listed within the S-1.