Investment picking: The 4 largest IPOs of unicorns technology companies in 2019

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Technology companies whose valuation reaches $ 1 billion is called unicorns. This year 38 IPOs of such companies took place. This is the largest number since the “dotcom crash” in 2000. Analysts predict that this record will be broken next year.
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Portal Investopedia selected the most promising and the largest IPO of unicorn companies that have all the chances to be held in 2019. Let's see what stocks investors from all over the world will soon be able to invest in.

Uber, industry: transport, valuation: $ 120 billion

According to WSJ, investment banks Goldman Sachs and Morgan Stanley estimate a taxi service at $ 120 billion. The last couple of years have been difficult for Uber - during this time, the company faced the founder’s departure under pressure after a series of scandals. The IPO could help businesses attract resources for the development of new activities, such as unmanned vehicles.

Airbnb, short-term lease, $ 31 billion

According to Forbes, the company plans to fully prepare for an IPO by July 2019. This means that with a high share of probability the placement of shares will take place in summer and autumn, however, there is also a possibility that the process will be postponed until 2020. Not so long ago, a former Amazon financial director was hired to work for the company - one of his tasks is to prepare for an IPO.

At the same time, according to some media reports, Airbnb is exploring the possibility of not a traditional IPO, but a direct listing on the stock exchange following the example of Spotify (we talked about the features of such a listing on the stock exchange in our blog ). The head of Airbnb, Brian Chesky, wants to make the placement of his company's shares as less traditional as possible, in addition to using the experience of Spotify, according to journalists, other options are being considered - for example, owners of real estate that surrenders through the platform may receive company shares .

Lyft, transport, $ 15 billion

One of the main competitors of Uber in the key US market, where its share is 28%. Now Lyft is estimated at $ 15 billion. The company's revenue in 2017 exceeded $ 1 billion.

According to FastCompany, the company has already begun preparations for an IPO - an application has been submitted to the American Commodity and Exchange Commission (SEC). Also, financial consultants were hired, who were tasked with preparing the placement of shares in March or April 2019.

Slack, software, $ 7 billion

Like Airbnb, the Slack management will consider a direct listing instead of a traditional IPO. According to rumors, the company's general director Stuart Butterfield became interested in this idea and is now studying it, although the final decision on the format of the placement of shares has not yet been made.

At the same time, the company has already hired Goldman Sachs to prepare an IPO and has scheduled it for the second half of next year.

What does the experience of "unicorns" in 2018

In 2018, companies that were not particularly well known to a wide audience dominated the IPO market. For example, the most successful placement was made by biotech company Elanco Animal Health - it attracted $ 1.74 billion. With good luck, next year the situation will change.

However, obstacles and risks remain on the path of unicorns to IPO. This is evidenced by the experience of their predecessors. For example, Dropbox's IPO received restrained valuations - the company was valued at $ 9 billion before entering the stock exchange, and after that the valuation did not reach $ 10 billion. At the moment, Dropbox shares are 2% more expensive than at the time of placement. Often, in the case of IT companies, the price may fall below the level of accommodation, so this is not bad. However, the price is still below its peak values ​​by about 50% - and this fact is already less pleasing to investors.

There are also examples of unsuccessful placements - after the IPO, Tencent Music Entertainment Group (TME) shares fell far below the price of $ 13 per share. On the other hand, the DocuSign service was able to achieve serious profits for investors - after placing akiy at a price of $ 29 per share, they rose to almost $ 42.

An example of Tencent should show the leadership of large IT companies that it is impossible to relax even if they successfully prepare for an IPO. During the dot-com boom period, many companies made super-successful IPOs and then went bankrupt. The fact that before entering the stock exchange the company's valuation was a billion or more, does not guarantee further success. Who will be able to maintain and improve their positions - we will know very soon.

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