In December 2016, it looked like the scene for all the unicorn to go public was set. We only, however, witnessed one major tech IPO so far.
Snapchat went public on the 2nd March 2017 and performed very well on the first day of trading. Its shares opened at $17 and by the time the markets closed the price had risen to $25. On the 3rd March, Snap’s shares hit record highs approaching $30 a share due to a massive but irrational surge of optimism. This was followed by a remarkable correction on the 6th March when the share price dropped from roughly $28 to $23. Later, shares continued to fall and today, Snap shares are trading for about $19.
At the moment, the most watched private company would probably be Uber. Investors cannot wait for Uber to go public and if you are one of them you will be disappointed. According to the Wall Street Journal, Uber which is recently valued at $68 billion, has said it’s in no rush to go public. Moreover, Uber was recently struggling with sexual assault lawsuits and according to Barrons.com its CEO Travis Kalanick was recently recorded getting hot-tempered with an Uber driver who was upset about lower fares. All these factors would definitely not help Uber even if they decided to go public this year.
Just like Uber, Airbnb also claims that it has no immediate plans to go public. According to Airbnb CEO Brian Chesky, they will go public within the next two years. Despite Chesky’s claims, it is generally anticipated that Airbnb will go public in 2018. Investors should not miss this major event as the company is valued at $30 billion according to fortune.com and will definitely be one of the biggest IPOs.
Dropbox providing up to two gigabytes of free storage, became an instant hit for its slick design and easy use shortly after its launch in 2008. Since then, it managed to pull in more and more users. Today, Dropbox possesses a base of over 600 million users worldwide.
Furthermore, Dropbox continues to expand its services and has now created a separate product line called ‘Dropbox Business’ to attract small-sized businesses. After Dropbox founders met with advisers in 2016 to consider going public, Dropbox is the most likely candidate for an IPO in 2017.
Pinterest, despite expecting $500 million in ad revenue this year which is a 67% increase from 2016, claims that it doesn’t plan to follow in Snap’s footsteps in its plans for an initial public offering.
A spokesperson told Business Insider that Pinterest doesn’t have any ‘current plans’ for an IPO and is ‘focused on growing the business.’ Even though we might not see Pinterest going public this or next year, it is definitely a social network worth watching due to its enormous growth and potential.
Spotify, a music streaming service, is most recently valued at $13 billion and will be the first major company to carry out a direct listing on the New York Stock Exchange according to Reuters.com.
Direct listing eliminates the need for an investment bank to underwrite an initial public offering and so Spotify could save millions in underwriting fees. It is, however, working with investment banks Goldman Sachs, Allen & Co and Morgan Stanley to advise them on the direct listing process. If Spotify is successful with the direct listing, it could change the way companies approach selling shares to the public. Spotify is expected to go public later in 2017 or early next year.
Other tech companies that might go public and are worth watching include Lyft, BuzzFeed, Glassdoor, Palantir and Vice Media.