IPOs or i-P.O.S. ?

[Read the Footnotes]

There have been many qualitative factors for years that indicated that PE/VC is was an area that was ripe for silliness to ensue. Do you think the recent round failing IPO's is a sign that these businesses were really i-P.O.S. ? Do you think that the fast reversal in how IPOs have faired this year is a PE/VC bubble is starting to deflate?

 

Lyft and Uber are Down since IPO

WeWork and Endevour IPOs were postponed

SmileDirectClub and Peloton made poor showings in their IPOs

[alpha asset strategies]

I think the PE / VC bubble is definitely starting to deflate.  However, I'm even more amused with your title for this topic. 

[Read the Footnotes]

I think the PE / VC bubble is definitely starting to deflate.  However, I'm even more amused with your title for this topic.

 

Thanks. I just made it up in hopes of amusing you.

 

Hopefully the discussion will be more amusing than the title. The topic is a bit redundant to the WeWork thread, but I don't believe there is a place to discuss the trend as a whole, so maybe this thread will be of use.

[John Hjorth]

To me, this is really locally & industry dependant. Success in this space is all dependant on all kind of skills. Some have them, others not - outcomes seem to me to be dependant of that.

 

To me, PE/VC is here to stay, but it's really not my kind of stuff, personally.

 

Disclosure : I'm invested in PE long term, by BAM [bBU indirectly] and Swedish Investor AB, [which just recently IPO'ed [successfully] EQT [<- !]]

[Gregmal]

https://www.marketwatch.com/story/pelotons-viral-ad-captures-a-116-lb-womans-yearlong-fitness-journey-to-becoming-a-112-lb-woman-2019-12-02?siteid=yhoof2&yptr=yahoo

 

Note to everyone. Pelotons are apparently bad gifts...Not a fan of the product, or the stock, but what the heck has society come to...who ever would have thought there'd be people outraged over encouraging a healthy lifestyle?

[Spekulatius]

I think lousy POS IPO’s always existed, but they tended to be smaller issues they were placed by 2nd or 3 rate investment shops. What is new now is that some business with questionable models were growing in tens of billion $ valuation before the IPO. They were sponsored by deep pocketed investors like Softbanks,  it also mutual fund investors like Fidelity or the first Tier investment banks (GS, Morgan Stanley).

 

Softbank seems to believe they can create their own moat by outspending anybody else out there, which has some logical underpinning if you believe their investment can become dominant  platform companies. While this might be true, it’s also a recipe to fund companies that blow through a lot of money and in some cases don’t even show great economies of scale.

[Spekulatius]

RKT is an interesting case. It’s a mortgage originator with a growing market share. IPO stumbled out of the gate @$18/ share. They seem to have negative equity  due to a ~3.8B dividend recap prior to the IPO.

 

The structure seems optimized for the founders tax and to keep total control.

https://www.sec.gov/Archives/edgar/data/1805284/000104746920004448/a2242208z424b4.htm

 

No position. Closest public peer is PFSI.

[Spekulatius]

ABNB should be an interesting one. Pricing between $$44-$50 actually seems to be reasonable. I try Fidelity for an allocation but I don’t think I will get any.

 

I am not interested in Doordash, but those guys truly timed their IPO well.