- Correction is expected to end soon and revamp the IPO market.
- Among six tech companies that filed for IPOs in the previous week, four of them were biotech firms.
- Uber IPO rumors might accelerate Lyft’s IPO, and Good Technology scrapped IPO plans as Blackberry acquired the company.
- Cybersecurity company Tanium raised $120M in the biggest funding round of the week.
The IPO Recap
The equity market went through another week of correction when all three major indices--The Dow Jones Industrial Average (INDEX:INDU), Nasdaq 100 (INDEX:COMPX), and S&P 500 (INDEX:SPAL)-- closed the week in the red with almost -3% down. However, the current bear market might be coming to an end as JP Morgan (NYSE:JPM) strategist Marko Kolanovic estimated another 3 weeks of selling, and the PBOC estimated volatility in the Chinese equity market is coming to an end. Once the sell off slows down, the IPO market will take off again.
Note: You might also be interested in Amigobulls' Tech IPO coverage.
In the previous week, there were neither companies going public nor setting any IPO pricing. However, six technology companies either filed for IPOs or revised the terms. As shown in the table below, four out of the six companies consist of biotech companies developing different solutions, and the biggest IPO of the six is NovoCure’s.
|Company Name||Symbol||Exchange||Amount ($M)||Sector||Summary|
|Boxlight||BOXL||NASDAQ||24.25||Education Technology||Boxlight is a developer of interactive technology and classroom solutions for schools and other education institutions around the world|
|PointClickCare||PCLK||NASDAQ||100||Cloud / SaaS||PointClickCare provides a comprehensive online platform for senior care service that consolidates more than 10K providers.|
|Mapi Pharma||MAPI||NASDAQ||57.5||Healthcare / Biotech||Mapi Pharma develops chemical and pharmaceutical technologies to slow release generic drugs to increase their life span and reduce doses.|
|NovoCure||NVCR||NASDAQ||300||Healthcare / Biotech||Novocure develops oncology solutions for treating brain cancer with electric field using a unique headset|
|Sancilio||SPCI||NASDAQ||86.25||Healthcare / Biotech||Sancilio is a developer of lipid based pharmaceutical solutions.|
|PharMEDium||PMHC||NASDAQ||100||Healthcare / Biotech||Developer and provider of customized pharmacy sterile compounding for hospitals intravenous (IV) and epidural therapies|
The IPO Week Ahead: September 7
The instability in the global markets continued to impact the IPO market, and currently, there are no IPOs scheduled for this week. However, many companies that filed their S-1/F-1 with the SEC haven’t priced their offerings yet and are expected to do so in the upcoming weeks. In case there are any developments during the week, I will provide updates in the comment section below.
IPO Market Events
In last week’s Tech IPO News Weekly, we cited an internal Uber document that was leaked to Reuters, which mentioned that the ride-on-demand app developer Uber planned to go public in 2017 after reaching an incredible valuation of $51B with $2B of revenues expected by the end of the year. The technology news site Re/code claimed in an interesting article that Uber’s IPOs could stimulate Lyft, its American rival, to go public soon. The writer sees great value in Lyft's going public before Uber as “the company would also be able to grab early dollars, attracting investors that didn’t have the opportunity to access Uber’s big private funding rounds.” The Re/code article did not contain any official comment from Lyft’s spokesperson, but it raises this issue and might trigger investors to seek an IPO in 2016. Further analysis of a possible Lyft IPO will be available later this week on Amigobulls.
A long time IPO candidate, Good Technology was acquired last week by Blackberry (NASDAQ:BBRY) for $425M in cash – scrapping the company’s IPO plans. Good Technology provides secure messaging solutions, mainly on Android and iOS devices, and will allow Blackberry to expand its secured offering to other platforms, supporting its strategic decision to go beyond its proprietary operating system and grab more market share in the mobile devices market. Good technology will allow Blackberry to expand its reach significantly to new customers in aerospace, defense, healthcare, and commercial banks where Good plays a prominent role.
Private Market Developments
These are the exceptional transactions worth mentioning in the private equity market from the previous week:
- Tanium – Cybersecurity firm Tanium raised $120M from investment firm TPG Capital, Institutional Venture Partners, and T. Rowe Price. Tanium’s solutions allow large IT networks within enterprises to collect real-time data on each IT asset in seconds and keep track that one was compromised or hacked or even needs a new update. The current funding rounds almost doubled the total amount the company raised since it was founded eight years ago and valued it at $3.5B. A further analysis of Tanium will be available later this week on Amigobulls.
- Apptus – The sales software provider Apptus raised $108M from Salesforce Ventures, Iconiq Capital, K1 Investment Management, and Kuwait Investment Authority. The Apptus solution is based on the Salesforce 1 platform and enables enterprises to manage their customer relations and sales through advanced algorithms, fully adaptive products and behavioral research. This current funding round (series C) brings the total funds raised in 2015 to $150M, valuing Apptus at $1B.
- Letgo – The second-hand e-commerce service Letgo raised $100M from the South African e-commerce, media, and internet group Naspers. Letgo is targeting the local transactions of buying and selling used goods, a market currently dominated by Craigslist and eBay.
Disclosure: The information provided in this article is for informational purposes only and should not be regarded as investment advice or a recommendation regarding any particular security or course of action. This information is the writer's opinion about the companies mentioned in the article. Investors should conduct their due diligence and consult with a registered financial adviser before making any investment decision. Lior Ronen and Finro are not registered financial advisers and shall not have any liability for any damages of any kind whatsoever relating to this material. By accepting this material, you acknowledge, understand and accept the foregoing.