Driven Brands’ explosive initial public offering with Roark Capital exiting was the culmination of a multi-year process. After joining the team as CFO in March 2020, Tiffany Mason immediately began drafting Form S-1, the initial registration form the Securities and Exchange Commission requires public companies to file. Then, the pandemic hit and widespread stay-at-home orders took place.
Driven Brands, which is headquartered in Charlotte, North Carolina, is the largest automotive aftermarket services company in North America and has more than 4,300 locations in 15 countries, which generates approximately $4 billion in systemwide sales.
Driven kept its S-1 filing timeline intact because it wanted to be prepared to take the company public when the country reopened, Mason said, “so it wasn’t us not being ready, it was the market not being ready that was going to delay us. We kept going despite what was happening just to make sure.”
Mason recruited 16 experienced executives from publicly traded companies to manage the IPO and ensure compliance with all regulations. The company also used the COVID pause to seize the opportunity to enter the car wash business in August 2020, and acquired its 100th car wash, subscription-based Magic Tunnel Car Wash, in fall of 2021.
“Buying a car wash business in the middle of 2021 set us up for an IPO valuation that was much more fruitful, and we used every bit of delays and markets being ceased to our advantage,” Mason said. The car wash business also bolstered the company’s overall growth, which reached about $1.08 billion in total revenue in the first three quarters of 2021—a 75 percent increase year over year.
Driven Brands completed its IPO on January 14, 2021, of 31.8 million shares on Nasdaq under the ticker DRVN at $22 per share—19 percent higher than the initial range of $17 to $20. Driven raised $700 million and was the only retail IPO over $500 million to price $2 above the range in Wall Street history, and the highest file-to-offer of any consumer and retail IPO over $500 million, according to Bank of America, bookrunner on the deal.
Within 30 days after the IPO, underwriters exercised an overallotment option for an additional 4.8 million shares. As of late March, Driven’s stock price was $26.93 per share and its market capitalization was $4.51 billion.
Jonathan Fitzpatrick, Driven Brands CEO, recalled, “I think we were about a week away from starting our roadshow when the terrible incident at the capitol happened, January 6, which set the markets into turmoil. The team let by Tiffany and others in Driven did a phenomenal job managing lots of micro conditions.”
When asked how going public has changed what he can and cannot share about Driven Brands, Fitzpatrick laughed. “I’m probably muzzled a little bit more than I was before,” he admitted. “I’m typically pretty open and transparent around all things in the company, and have been for the prior 10 years, but these are the rules of engagement … I have to be a little more disciplined in what I talk about, and still try to do it with passion, energy and as much transparency as possible.”
“The IPO was sort of like a wedding,” Mason added. “It’s a point in time, but what happens after that is what really matters. We celebrated like we should, but know we’ve got to continue to deliver every quarter and put up great results, grow, build credibility and serve our shareholders.”