The US has one the world’s largest primary markets with an annual growth of over 200%
The year 2020 saw a substantial growth for the primary markets in the US, where companies floated their shares for investors. The US primary market has raised around $83 billion with 203 IPOs completed in 2020. Companies such as Airbnb Inc, DoorDash Inc, and Snowflake Inc were some of the popular names that listed in the markets during the Covid-19 pandemic.
The year 2021 feels high on enthusiasm so far with the markets posting new all-time highs, amidst concerns about listings overheating. Here are three sought-after IPOs happening this year that could generate great listing gains.
Instacart
The US grocery delivery firm plans to go public this year through a direct listing. This would make Instacart the latest company to ditch the traditional way of floating shares for direct listing.
The California-based pick-up service company has no short-term need for cash after raising $265 million in private fundraising last month. The company’s business has benefited from the global pandemic with more consumers shopping groceries online.
Investment bankers who are currently working on Instacart’s issuing process predict the valuation of the company at $50 million. Instacart raised $39 billion in its latest fundraising in October 2020. The potential IPO valuation is expected between $17.7 billion and $30 billion.
Robinhood
Robinhood is considered one of the hottest IPO in 2021. The no-commission trading app, which has completed 8 years of operations, has developed a great database of small retail investors.
Robinhood raised $3.4 billion through existing investors and by tapping revolving credit lines. Whether through an IPO, direct listing, or special purpose acquisition company, Robinhood is likely to go public by the second quarter of 2021.
The California-based company boasts of a valuation of approximately $20 billion. Robinhood raised $660 million in a Series G funding round, which valued the company at $11.7 billion in September 2020. The company further raised $3.4 billion in investment last month.
Robinhood generated $682 million in revenue in 2020 and, represents a 514% increase year on year. The potential IPO valuation of the company is between $10 billion and $20 billion.
Coinbase
Leading cryptocurrency exchange Coinbase is one of the favorites to come up with a public issue as currencies such as Bitcoin and Ethereum hit all-time highs in recent months. The company will list on the Nasdaq, and has recently allowed pre-IPO shares to trade on the Nasdaq private market, fetching valuations between $50 billion and $75 billion.
The San Francisco-based cryptocurrency exchange platform earns a spread of about 0.5% on each transaction, as well as a transaction fee of at least 1.49%. That means the corporate directly benefits from not only the rising popularity of cryptocurrency but the upper nominal prices of cryptocurrencies also.
Coinbase was revaluated by Wall Street analysts, which resulted in worth as high as $77 billion – that’s about $300 per share, which is up roughly 33% from the private market-IPO, and now the valuation is now edging upward of $100 billion.
On March 17, 2021, Coinbase published an amended S-1a form that stated the company plans to issue 11.48 billion shares of Class A common stock for a total price of $94.32 billion. The company has not mentioned any official listing date.