This is the IPO market unicorns were waiting for
After the bell yesterday, Apple-device management company Jamf announced its final IPO pricing. We’ve been tracking the Jamf IPO for some time, as it is yet another example of a technology company worth $1 billion or more going public during the COVID-19 pandemic.
Back in March, we’d have guessed that today’s IPO market would be devoid of any public offerings, let alone a litany of successful flotations. But, 2020 is unpredictable; instead of seeing an IPO drought, there have been a modest deluge of debuts.
And yesterday Jamf continued the trend of recent IPO pricing strongly, at times selling more shares in the bargain.
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Jamf’s IPO underscores that public market investors are hungry for new technology offerings and keen on growth but are willing to accept what startups would consider middling expansion — and sufficiently greedy to pay up both before and after a company begins to trade.
This is the IPO market that unicorns were waiting for.
Happily, more companies — and let’s be so bold as to say unicorns — could approach the public markets in short order. The Exchange spoke with Wouter Witvoet, CEO of startup equity service provider Secfi, yesterday to get his view on today’s IPO market and coming offerings. Sitting as he does between growing startups and their vested employees, Secfi has a fascinating lens into the maturity of the firms we discuss when we talk about future IPOs.
On the subject of companies going public today with strong pricing runs, Witvoet said that “what you’re seeing is that IPOs have dried up for a very long time, and people want to deploy cash.” More cash means more dollars chasing IPOs, which helps explain the current pricing cycles we’ve seen. Witvoet cited Palantir as a company that is “making use of the opportunity that there is somewhat of an IPO window now to go public,” going on to say that he had expected Snowflake to stay private longer, but that it instead opted to start its own IPO process, perhaps due to attractive market conditions.
