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After a Banner Year for IPOs, Here Are the 10 Largest Unicorns Left in the Private Market -- Barrons.com
6:29 am ET October 20, 2020 (Dow Jones) Print
By Eric J. Savitz
The new issue market is alive and well. Already this year, there have been 167 initial public offerings, or roughly one every two days. That includes everything from venture-backed tech and biotech companies to blank check SPACs, or special purpose acquisition companies.
We've seen high-profile IPOs from companies like Snowflake (ticker: SNOW) and Warner Music (WMG); direct listings from Asana (ASAN) and Palantir (PLTR); and listings via SPAC mergers for DraftKings (DKNG) and Nikola (NKLA). Investors are thirsting for new ideas and new investment opportunities, and the market is answering the call.
And we're far from scraping the bottom of the barrel -- the supply of private companies remains broad and deep. According to the investment research firm CB Insights, there are nearly 500 venture-backed companies around the world with valuations of $1 billion or more.
To get a sense of potential blockbuster deals to come, we put together the accompanying list of 10 highly valued unicorns that could eventually reach the public markets. To keep things simple, we've focused specifically on U.S.-based companies. (There are many others in China and elsewhere.)
At the top of the charts is SpaceX, Elon Musk's rocket ship company, with a private-market value of $46 billion based on its last fundraising. In May, in the middle of the pandemic, SpaceX made history with the first space flight by a private company, in this case ferrying astronauts to the International Space Station.
Musk's track record with Tesla (TSLA) -- the first successful new auto company in decades -- could make SpaceX a hot deal if it files to go public. But the economics of the company are unclear and no doubt lumpy -- this is no cloud-based software company with a recurring revenue model. They make rockets, and then fly them. There aren't many "comps," other than conventional aerospace companies and the space tourism company Virgin Galactic (SPCE).
Stripe, a payments processing company last valued at $36 billion, is often viewed as a potential IPO candidate. The company created a buzz over the summer by hiring away General Motors (GM) chief financial officer Dhivya Suryadevara to be their own CFO. The company has denied any near-term IPO plans, but that will likely change.
Airbnb announced in August that it had filed confidential paperwork with the Securities and Exchange Commission for an initial public offering; DoorDash made a similar disclosure back in February. Both are still expected to "flip" their filings to public filings before year-end. Instacart, the grocery delivery company, has reportedly held talks with investment bankers about an IPO as soon as this year.
Epic Games has been in the news lately for its epic battle with Apple (AAPL) over its App Store fees. Epic is the maker of the popular Fortnite videogame. An Epic IPO might be well received -- there was a strong reception for the recent Unity Software (U) offering -- but a near-term deal seems unlikely.
There would be no more appropriate near-term IPO than Robinhood, which has become the platform of choice for aggressive traders who like to speculate in, among other things, new stock issues.
Among the companies on our unicorn list, Juul Labs, the e-cigarette provider, could be the least likely to go public soon. The company has seen a sharp drop in its valuation amid widespread controversy over the company's core market.
Write to Eric J. Savitz at [email protected]
(END) Dow Jones Newswires
October 20, 2020 06:29 ET (10:29 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
6:29 am ET October 20, 2020 (Dow Jones) Print
By Eric J. Savitz
The new issue market is alive and well. Already this year, there have been 167 initial public offerings, or roughly one every two days. That includes everything from venture-backed tech and biotech companies to blank check SPACs, or special purpose acquisition companies.
We've seen high-profile IPOs from companies like Snowflake (ticker: SNOW) and Warner Music (WMG); direct listings from Asana (ASAN) and Palantir (PLTR); and listings via SPAC mergers for DraftKings (DKNG) and Nikola (NKLA). Investors are thirsting for new ideas and new investment opportunities, and the market is answering the call.
And we're far from scraping the bottom of the barrel -- the supply of private companies remains broad and deep. According to the investment research firm CB Insights, there are nearly 500 venture-backed companies around the world with valuations of $1 billion or more.
To get a sense of potential blockbuster deals to come, we put together the accompanying list of 10 highly valued unicorns that could eventually reach the public markets. To keep things simple, we've focused specifically on U.S.-based companies. (There are many others in China and elsewhere.)
At the top of the charts is SpaceX, Elon Musk's rocket ship company, with a private-market value of $46 billion based on its last fundraising. In May, in the middle of the pandemic, SpaceX made history with the first space flight by a private company, in this case ferrying astronauts to the International Space Station.
Musk's track record with Tesla (TSLA) -- the first successful new auto company in decades -- could make SpaceX a hot deal if it files to go public. But the economics of the company are unclear and no doubt lumpy -- this is no cloud-based software company with a recurring revenue model. They make rockets, and then fly them. There aren't many "comps," other than conventional aerospace companies and the space tourism company Virgin Galactic (SPCE).
Stripe, a payments processing company last valued at $36 billion, is often viewed as a potential IPO candidate. The company created a buzz over the summer by hiring away General Motors (GM) chief financial officer Dhivya Suryadevara to be their own CFO. The company has denied any near-term IPO plans, but that will likely change.
Airbnb announced in August that it had filed confidential paperwork with the Securities and Exchange Commission for an initial public offering; DoorDash made a similar disclosure back in February. Both are still expected to "flip" their filings to public filings before year-end. Instacart, the grocery delivery company, has reportedly held talks with investment bankers about an IPO as soon as this year.
Epic Games has been in the news lately for its epic battle with Apple (AAPL) over its App Store fees. Epic is the maker of the popular Fortnite videogame. An Epic IPO might be well received -- there was a strong reception for the recent Unity Software (U) offering -- but a near-term deal seems unlikely.
There would be no more appropriate near-term IPO than Robinhood, which has become the platform of choice for aggressive traders who like to speculate in, among other things, new stock issues.
Among the companies on our unicorn list, Juul Labs, the e-cigarette provider, could be the least likely to go public soon. The company has seen a sharp drop in its valuation amid widespread controversy over the company's core market.
Write to Eric J. Savitz at [email protected]
(END) Dow Jones Newswires
October 20, 2020 06:29 ET (10:29 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
