Houzz Inc, the U.S. online home remodeling platform that capitalized on the boom in renovations during the COVID-19 pandemic, has hired Goldman Sachs to prepare for an initial public offering, people familiar with the matter said.
Houzz is aiming to go public early next year, the sources said. The Palo Alto, California-based company was last valued at about US$4 billion in a private funding round led by ICONIQ Capital in 2017.
The sources cautioned that the timing of the IPO is subject to market conditions. They asked not to be identified because the matter is confidential.
Houzz and Goldman Sachs declined to comment.
Founded in 2009 by Adi Tatarko and Alon Cohen, Houzz operates a marketplace that is used by home renovation professionals to find home remodeling and improvement projects. It offers subscriptions for those projects, and also sells furniture using third-party sellers.
Houzz is among a spate of internet companies that benefited from people staying at home during the pandemic and shopping online. Pinterest Inc has attracted the acquisition interest of PayPal Holdings Inc, which made a US$45 billion offer for the online scrapbook and photo-sharing website, sources said on Wednesday.
To be sure, a Houzz IPO could face headwinds, as more people return to the office as the pandemic subsides, while soaring inflation makes remodeling more expensive.
Houzz was forced to lay off 10per cent of its staff at the onset of the pandemic, citing the impact on small businesses in the home renovation sector that form its core paid-user base. Its business later boomed as more users turned to it.
Houzz, which has raised over US$650 million in funding to date, counts the likes of Sequoia Capital, New Enterprise Associates, GGV Capital and DST Global among its prominent backers.
(Reporting by Anirban Sen in Bengaluru and Krystal Hu in New York; editing by Richard Pullin)