2017 remains a mystery in terms of how many and which prominent companies will take the leap into the public market.
2016 was a slow year in terms of IPO’s, but a few companies managed to successfully make the transition into the public sphere. One such company was Vancouver, BC based clothing retailer, Aritzia. A brand known for it’s casual/cool neutrals and quality-over-quantity pieces, the stock closed at $17.71 at the end of Monday (Oct. 3, 2016) – $3 above the set share price of $16 leading up to the IPO. $460 million was raised in total – split mostly between founder Bryan Hill and Berkshire Partners of Boston.
A Japanese messaging app company called LINE, made a splash in July when it sold a total of 35 million shares of common stock on opening day, split between the Tokyo Stock Exchange and the NYSE. With active markets in Japan, Taiwan, Thailand and Indonesia, the company boasts 220 million monthly active users. But this isn’t your usual messaging app: users can book hotels, order taxis or search job postings, and send large, complex emoji stickers. Users can pay for premium stickers, and advertisers can even pay for sponsored stickers. “We believe that stickers have made communication both more convenient and more enriching,” the company said in its prospectus.
Another company that came out of the public gate kicking was Nutanix – an enterprise cloud company based out of San Jose, California. It recently found success in their initial offering which closed September 30, 2016, as shares rose over 131% on their first day, jumping from $16 a share to $37 by Friday close. The company already has clients that include Nordstrom, Nintendo and the US Department of Defense.
But there is talk that 2017 may be a big year for IPOs. Two companies that are on the tip of everyone’s tongue as of late and have been rumored to IPO in 2017, are Spotify and Snapchat. Spotify – the Swedish online music streaming service aims to IPO in the second half of 2017, say sources familiar with the plan. Spotify currently has more than 30 million customers, with last year’s sales almost doubling to $2.2 billion. With a current market valuation of $8 billion, this service has taken over the online paid music world by storm. Bloomberg writes that Spotify CEO Daniel Ek has persuaded more people to pay for music online than anyone besides Steve Jobs and Jeff Bezos.Lastly, the latest news out last week is that Snap Inc. has officially filed for IPO, confirming mounting rumors over the past 6 months. Snapchat, a favorite among filter-giddy college kids and Hollywood celebs alike, is said to be valued at $20 – $25 billion. An IPO could come as soon as March 2017, and a report on BBC News mentioned Morgan Stanley and Goldman Sachs could be underwriting the offering. December 2015 – June 2016 saw an increase in 40 million users and Snapchat now has approximately 150 million daily active users that post videos, send messages and change their faces in a wide array of cute to alarming filters.
We’ll have to wait and see how 2017 shapes up, but it looks to be on the upswing.