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18

Aug

2010

Summer IPO Market Proves Interesting PDF Print E-mail

Mark Heesen

Written by Mark Heesen   
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While many of us have been enjoying the last lazy days of the summer, the venture-backed IPO market activity has been quietly accelerating with August poised to be the busiest month for offerings since 2007.  Given the drought over the last several years, the distinction is relative.  Thus far this month, 7 venture-backed companies have gone public, bringing the total for 2010 up to 39.  There are an additional 47 companies in registration.  While we are far from declaring the market "healthy", we do seem to be on a sustainable track towards recovery.  One thing is for certain, the IPO market of tomorrow is unlikely to resemble the one of yesterday.  A few interesting stats to that point:
Thus far in 2010:
  • The median age of a company at IPO is 9.6 years, down from an all time high of 10.3 years in 2009.
  • The average offer amount of an IPO is $91 million.
  • Of the 39 IPOs, 3 are classified in the clean tech space; 10 are life sciences; 21 are in the information technology space; and 5 are non-high tech.
  • Of the 47 companies in registration, 4 are in clean tech; 14 in life sciences; 24 in information technology; and 5 in non-high tech
  • Twelve of the IPOs were listed on the NY Stock Exchange -- approximately 31 percent -- with the remaining 27 on NASDAQ.
  • Morgan Stanley and JP Morgan have been book managers on the most IPOs with each counting 13.  Boutique banks such as Piper Jaffrey (4), Jefferies (2) and Thomas Weisel (2) are active at a lower level.
Predictions are always a risky business, but I would venture a guess that these factoids are indicative of what the IPO market will look like for the next decade.  There will be fewer IPOs spread out over a more diverse set of industries..... and greater competition for their business.
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