(Photo credit @markuswinkler)
I was moderating a panel yesterday with multiple people who work in tech -- and one panelist offered a piece of advice to those attendees new to tech. “Keep up with tech news -- especially mergers & acquisitions -- because for some reason, tech people love to discuss M&A, IPOs, and startups.” I laughed as a) it’s true, b) I’m one of those people, and c) I had already selected this week’s newsletter tech topic as IPO fever has migrated from Silicon Valley to Wall Street. The excitement for these public listings is contagious.
#TECHTOPIC
This week began with a huge wave of B2B SaaS companies deciding to file paperwork to go public. The 6 companies that filed in the US included Snowflake, Palantir, Asana, JFrog, Sumo Logic, and Unity Software. (Don’t forget - Airbnb also filed last week.) Matt Turck at FirstMark Capital did a couple of S1 teardowns here - and the big news is that Palantir hasn’t made a profit in 17 years. Not to be outdone, Jack Ma’s Ant Group filed its IPO paperwork on Tuesday to go public with concurrent listings on the Hong Kong and Shanghai markets.
A few of the companies opted for a direct listing (which means they bypass investment banks), and so you also saw both the NASDAQ and the NYSE gain approval from the SEC this week to provide new direct listing options to companies.
And what is a SPAC? And why does the acronym feel so ‘eww’ when you say it? SPAC = special acquisition company, and is essentially a shell company that IPOs to raise money to buy another company that isn’t strong enough to IPO - so the SPAC can take it public anyway 2 years later or so. Confused? Not surprising. Just one more weird financial instrument out there.
The big question: why are so many tech startups are looking to IPO during a pandemic? Simple, the stock market continues its improbable rise and they want to take advantage!
Did all these IPOs get you excited about starting your own company? Check out this Startup Best Practices Library.
Want a Career in Tech but aren’t sure where to start? Take a look at MY COURSE, ‘TECH SEARCH COMPASS’ FOR STEP-BY-STEP SUPPORT
