The 2019 calendar year will long be remembered in the eyes of public market watchers as the year of WeWork. Once billed as the most valuable startup in the United States, the company unraveled in dramatic fashion after filing its S-1 with the SEC, thanks to numerous issues with the company’s business model and management practices.
This event, along with a succession of dud listings from such big names as Slack and Uber, spooked the markets, with IPO registration withdrawals up almost 50 percent in 2019, according to research firm Renaissance Capital. This left a sizeable backlog of potential listings for 2020, with the holiday rental company Airbnb headlining that list.
This busy runway was set to lead to a bumper year, but then the novel coronavirus hit and everything went on ice, with just a handful of technology IPOs of note until a burst of activity in June brought the market back to life.
Here are the biggest technology IPOs of the year so far:
Following Snowflake’s blockbuster listing, another software company – Sumo Logic – had a more modest first day of trading after its IPO on 17 September.
The monitoring specialist initially priced shares at between $17 and $21; these then climbed 22% on the first day of trading, closing at $26.88 and valuing the company at $2.65 billion.
The California-based firm specializes in machine data such as log analytics and security monitoring and competes with the likes of Splunk and Datadog, which both had a market cap of more than $26 billion at the time of the IPO. For the six months up to July 31, Sumo Logic lost $36 million on revenue of $97 million.
The biggest tech IPO of the year came in September, when cloud data warehouse vendor Snowflake arrived on the New York Stock Exchange. The San Mateo, Calif.-based company priced shares at $120, up from its initial pricing of $75-85. These immediately popped on the first day of trading, ending up by as much as 111% at $245 per share, raising $3 billion, the most ever for a software firm at IPO.
This put the company’s value at $70 billion, almost six times the $12.4 billion private valuation the firm had when it raised money earlier this year and more than established tech firms like Twilio, Atlassian, Workday and Okta. Like many of its peers, Snowflake is not yet profitable, making $264.7 million in revenue in 2019, at a net loss of $348.5 million.
The company has grown quickly since it came out of stealth in 2014 with a built-for-the-cloud data warehouse, promising customers access to real-time analytics without the concurrency and performance issues customers of first-generation options like Amazon Redshift were facing.
Playing second fiddle to Snowflake on 16 September, JFrog had a strong market debut of its own. Stock in the software company rose by as much as 62%, opening at $77 per share – up from its initial share price of $44. The stock closed at $64.79, valuing the company at $5.7 billion.
Founded in Israel in 2008 and now based in Sunnyvale, Calif., JFrog specializes in artifact management. It has since branched out into other important elements of the DevOps toolchain, all of which allows software developers to deploy changes faster.
Rackspace Technology returned to the public market on 5 August when it arrived on the Nasdaq. After four years as a private company under the ownership of private equity firm Apollo, the cloud and infrastructure specialist priced its initial public offering (IPO) at $21 a share – on the low end of its target range of $21 to $24 per share – raising $704 million in the process.
Stock prices for the company fell by as much as 20% on the first day of trading, making it the worst performing IPO of $100 million or more on a U.S. exchange this year, according to data compiled by Bloomberg.
The Insurtech pioneer Lemonade floated on 2 July, with shares doubling during the first day of trading. The New York company originally priced shares at $29, slightly above its initial estimation of $26-28, but traded for as much as $64 on the first day, raising $319 million in the process.
Founded in 2015, customers engage with Lemonade through an AI bot on its website – called Maya – to assess eligibility for renters’ or homeowners’ insurance, a model which has proved popular with younger users.
The company insured 425,000 homes in 2018, up from 100,000 at the close of 2017, according to its S-1 filing. Revenue reached $67 million in 2019, with net losses of $109 million for the unprofitable company.
Not to be confused with the red-hot videoconferencing company Zoom, ZoomInfo (ZI) successfully debuted on the public markets in June, raising almost $1 billion as its stock rose 60 percent on its first day of trading, valuing the company at $13 billion.
The 20-year-old software-as-a-service (SaaS) company offers a variety of services aimed at helping sales and marketing teams reach more customers by using its rich B2B contact data.
Shift4 Payments also priced its IPO above its range, at $23 a share, which trended upwards by as much as 45 percent on its first day of trading in June.
The Pennsylvania-based company, which processes business-to-business payments, was founded all the way back in 1994. The firm decided to push on with its IPO after it saw payment volumes start to recover in the spring.
“We have tons of data, and we started to see the recovery really in late March and through April, and then really accelerate in May,” CEO Jared Isaacman told Yahoo Finance. “That’s what gave us the confidence to kind of reignite the IPO process and get it going.”
Database specialist Exasol floated on the Frankfurt Stock Exchange on 25 May at €12.74, becoming the first German company to IPO in 2020. The company raised €87.5 million ($96 million) in its first four days of trading as prices popped, before settling down at €11.89 in June.
Founded in 2000, the company has built an in-memory relational database for the cloud and rivals other options like Snowflake, Amazon Redshift and Teradata. It can be run in a hybrid model and on any of the major public cloud platforms.
Kingsoft Cloud was the first Chinese company to go public in the United States when it floated on the Nasdaq on 8 May. The company raised $510 million at IPO, where it priced shares at $17, right in the middle of its expected range of $16 to $18. Shares jumped up by as much as 40 percent on the first day of trading.
Considered by many as the third place cloud services company in China, behind heavyweights Alibaba Cloud and Tencent, it was spun out of software company Kingsoft Corporation and is backed by technology giant Xiaomi, whose CEO Lei Jun is also the chairman of Kingsoft.
Still to list
Cloud data management firm Snowflake
Data analytics firm Palantir
Experience data specialist Qualtrics (to be spun out of parent company SAP)
Holiday rentals giant Airbnb
Videogame engine maker Unity
Productivity software maker Asana
Monitoring company Sumo Logic
Software automation specialist Jfrog
Cybersecurity firm McAfee
Apple device management specialist Jamf
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