The mythological unicorn has never been found, but the venture-backed unicorn market continues to amaze and enthrall the business world. These so-called unicorns are the private companies that have raised venture capital with valuations in excess of $1 billion dollars. These also happen to be the ongoing names that excite the public, and they are all either future or potential candidates for initial public offerings (IPOs).
Investors love reading about and chasing hot IPOs. After all, this is where you can invest early in the next Google, Facebook, Amazon and so on. It is also an area where investors can suffer a brutal beating if they lack discipline or make the wrong picks. If you don’t think bubbles can burst, think back to the last tech bubble for Webvan, eToys, TheGlobe and others.
The bull market is nearly seven years old. Investors have grown more cautious, but the reality is that investors of all sizes have bought up stocks on each and every pullback in the past four-year period. Perhaps the biggest question to ask about the IPO market going into 2016 is whether private market valuations are really above the public market valuations. This happened in 2015. Still, companies like Square, Box and others that were unicorns have managed to come public.
24/7 Wall St. has highlighted some of the more well-known unicorn venture-backed companies that may come public in 2016. Not all of them will come public of course, and another international market shock or a stock market sell-off would get in the way. Then there is the notion that the 2016 presidential election cycle may get in the way. Many of the names here are household names, like Uber and Lyft, or Snapchat and Pinterest. Other top names are Airbnb, DocuSign, Dropbox, Palantir, SpaceX, Spotify and Xiaomi.
The IPO market still seems very open to technology and socially oriented IPOs. That is no longer the case for energy (including alternative energy) and recent scandals (or potential scandal) with Theranos, and then drug price pressure from politicians may have dampened interest in the various companies in the biohealth sector.
CB Insights noted earlier in 2015 that there were nearly 150 unicorns valued at a total of more than $500 billion. So what happens when the 2015 IPO market was viewed as a serious disappointment all around? Maybe all those investment banks on Wall Street can convince the companies that they better come public while the markets can absorb them. Venture backers may even demand that the companies create liquidity events, which could even be buyouts.
24/7 Wall St. has given a description on each, added color and statistics if available, discussed recent capital raises and ultimate market valuations and more. These are 11 unicorns that might see IPOs start coming to light in 2016.
The wiki-hotel and house rental model lives on. Recent regulatory efforts to force individual homeowners and rental property owners into accounting and regulatory guidelines as hotels does not seem to be taking hold.
The last round of $1.5 billion in capital supposedly valued Airbnb north of $25 billion. Airbnb does have competition, but it also was last shown to have roughly 1.5 million unique listings around the planet from 30,000 cities and towns in 190 countries.