17 Apr IPO Market Surges Ahead

According to a recent report from the New York Stock Exchange, IPOs are back. The year 2013 saw the most IPOs since 2007, at 200 (this did not include SPACs). This in the first full year after passage of the Jumpstart Our Business Startups (JOBS) Act, which added the IPO “on ramp” to make going public through traditional means more attractive. The first few months of 2014 look to be going even higher than that. The US also represented nearly 50% of worldwide IPOs last year, the first time that’s happened since 2003 (based on IPO proceeds raised by region).

Technology, healthcare and financial companies still dominated the industries seeing IPOs, less so consumer, energy, materials and industrials. The report also indicates a very large pipeline of deals being worked on as well. Stocks are also trading well. The March report noted that 33 of 41 IPOs in 2014 are trading above their original IPO prices. In general, the tech IPOs do the best on their first day of trading.

But it’s been a tough road for the good old IPO. Averaging 200 deals a year from 2004-2007, there were barely 200 deals total in the next three years from 2008-2010. Things did pick up in 2011 and 2012 with 114 and 123 IPOs respectively. But even at 200 last year, this is way less than the 400-500 IPOs we saw annually on average during the dot-com boom in the late 1990s. There are still roughly the same number of reverse mergers as IPOs, in some years more reverse mergers. So there could still use some tweaking to the IPO world, and hopefully things like the new Regulation A+ IPO alternative will help!