Casper Sleep slashes the price range for its planned IPO

Mike Blake/ReutersCasper CEO Philip Krim

• Casper, the online mattress company planning to go public, slashed its target share price range, according to a Wednesday filing.
• The new price values Casper at a fraction of the $1.1 billion private markets valued it at in its most recent funding round.
• The startup has marketed itself in its IPO prospectus as a tech company.
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Initial shares in Casper will be cheaper than previously expected.

Casper cut its target share price range for its initial public offering to between $12 and $13 according to a filing with the Securities and Exchange Commission on Wednesday. That slashes the company's overall valuation to around $500 million, down from the $768.2 million the online mattress retailer projected just over a week prior, on January 27.

It's a fraction of what private markets have valued the company at. In Casper's more recent funding round, private stakeholders gave the company a $1.1 billion valuation. Public investors may be more skeptical.

In its January IPO prospectus, the company branded itself to potential investors as a tech firm, using the word "technology" 121 times, even more times than WeWork did. The company said its technology will drive its future growth. But for now, its only technology product for sale is a smart lamp.

The company's main business is a direct-to-consumer model that sells mattresses to customers online. That model has earned it a reputation as the Warby Parker of mattress companies. The startup, which began in 2014 and has delivered mattresses to more than 1.4 million customers, now has a physical presence too, including 60 storefronts.

Casper filed to go public in January, with Morgan Stanley, Goldman Sachs, and Jefferies leading the IPO, according the Casper's SEC filings.

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