According to stock analytics, the number of IPOs last year plummeted compared to 2021. During that year, over 1,035 companies enlisted and entered the IPO market. Meanwhile, 2022 only had 181 new IPOs.
So far, 2023 has 23 corporations going public. Investors have high expectations from several start-ups to enter the IPO market. Some of these companies are in the tech division, such as Databricks.
Others are in the social media scene, like Discord and TikTok. That said, each organisation may project a public capital entrance in 2023. Stick around to learn more about the start-ups that may have an IPO soon.
Discord is a Voice-over-Internet-Protocol chat application. It allows users to communicate via chat, text, and screen-share. The platform is popular among gamers and streamers.
The app launched in 2015 and is valued at over $15 billion after accumulating over $500 million in a funding round. Since discord gained unicorn status, investors speculated about its candidacy for an IPO.
They forecast a public opening by this year. The company attempted to acquire a public listing last year. Nevertheless, it postponed these plans due to unfavorable market conditions. The social media platform expects to find its place in the NASDAQ marketplace exchange.
The company received a buyout offer from the tech giant Microsoft for over $10 million, but Discord rejected it and set its eyes on an IPO. Discord’s success is prominent from its impressive $130 million revenue in 2020 to its monthly 140 million users.
Databricks provides clients with a cloud-based platform for their large-scale data processing needs. The founders of Apache Sparks founded the start-up in 2013. The company’s valuation is over $38 billion thanks to its 42 investors, including Race Capital and Green Bay Ventures.
By late October 2022, Databricks’ valuation took a downturn after trimming its internal share price. Its valuation stooped to $31 billion, accumulating a 7% hit. Despite that, the CEO of Databricks, Ali Ghodsi, anticipates an IPO market in 2023.
According to Ghodsi, “We’re not in a super hurry to IPO. We’re not pushing it out or anything like that. We’re on a long journey.” That said, Databricks’ growth prospectus looks positive. The company expects to build a $130 billion valuation by 2025.
Plus, the San Francisco-based organization accumulated over $800 million in revenues in 2021. That’s over $270 million more in annual recurring revenue than Databricks’ competitor Snowflake, which launched its IPO in 2020.
Stripe is a B2B company offering payment and credit card transaction processing. The San Francisco-based company has goals of going public by 2023. It has plans to either go public or let employees sell stock.
In recent news, the organization raised a whopping $600 million in funding to increase its valuation to $95 billion. Following that critical raise, the company witnessed a drop in 30% valuation due to decreased investor demand for tech.
Valued now at $74 million, Stripe is searching for an IPO opportunity to cover more capital. In other issues, long-standing Stripe employees are awaiting stock awards deadlined this year.
For this reason, IPO capital proceeds would likely go to an annual tax bill rather than operating expenses. Although the FinTech company is experiencing internal cuts, IPO investors anticipate its launch in the public market.
In essence, Guild Education matches students to universities. Additionally, the platform assists employees by refining their skills through multiple educational programs. The Denver-based organization earns revenues through commissions from connecting students.
Nowadays, employers tend to focus on upskilling their employees with e-learning programs offered by Guild Education. With increased demand comes IPO potential.
With multiple investors like Felicis Ventures, General Catalyst, and Salesforce Ventures, the company continues to accumulate financial rounds for its capital growth.
During a downturn in the ed-tech market, Guild received a Series F funding round of $175 million.
The share amount included notable investors like Oprah Winfrey partaking in the funds. The company’s projected growth is prominent. The company’s valuation currently rests at $4.4 billion.
Instacart is an online and mobile app platform that provides customers with a grocery solution. The company has pick-up and delivery services fulfilled by personal shoppers. Apoorva Mehta founded Instacart in 2012.
Despite speculations of going public, Instacart has seen better days in the financial landscape. Pre-2022 started strong, with the company’s valuation reaching over $40 billion.
By the end of the year, the delivery service witnessed a staggering 75% internal cut after a series of slashes throughout the year. What’s left of Instacard is now $10 billion.
These slashes come from a market slowdown in the tech industry. People started ordering fewer meals post-pandemic. Subsequently, 2023 might pose more favorable market conditions when the company can expect to go public.
Accordingly, Instacart filed a draft with the U.S. Securities and Exchange Commission (SEC). It’s a step in the IPO direction.
Even though investors speculate that the company may appear on Chinese IPO listings rather than U.S. ones, it deserves a notable mention. The social media’s presence in the country is prevalent, with over 80 million U.S. monthly users.
A Forex source states, “TikTok will likely go public in the US, and ByteDance’s domestic assets will go public in Hong Kong.”
Owned by ByteDance, the giant company’s IPO possibility is a nail-biting prospectus for investors. TikTok’s rise shines over other platforms, such as Facebook and Twitter. The popular Gen-Z app estimates a popping $300 billion valuation, making it one of the highest on the list.
Despite this mammoth valuation, the company experienced a 33% reduction due to a share buyout from ByteDance. A buyback usually increases a stock’s price and allows companies to hit a quarterly earning per share target.
Arctic Wolf is a cybersecurity provider. The company sits at a current $4.3 billion valuation. The amount comes from a recent $401 million investment of convertible notes from stakeholders like Owl Rock.
Convertible notes are short-term loans repaid after a particular maturity date. Arctic Wolf will likely repay the amount with a discount or interest. It primarily depends on the contract. In some instances, companies can pay back after acquiring an IPO. Alternatively, investors may resort to equity.
Arctic Wolf’s growth is apparent through its customer retention. Over 60% of 3,000 clients use at least three of its security management services.
The company ranks 161 in the Deloitte Technology Fast 500. The rank measures tech companies’ revenue growth in North America.
As the cybersecurity firm continues its successful growth, an IPO this year is likely.
Plaid allows FinTech companies to connect users’ bank accounts to wallet applications and other FinTech solutions. Its notable clients include “branch,” SoFi, Betterment, and Stash. The company uses advanced encryption processing protocols to protect your data during the transfer.
It uses security precautions like Multi-Factor Authentication (MFA) and bug bounty programs. According to a digital banking survey, 80% of account-holding Americans favor digital transactions, building more future promise for Plaid.
In terms of the company’s finances, it’s shaping up to gain IPO status in 2023. Its current valuation is over $13.4 billion after a Series D funding round raising $425 million.
Visa almost purchased Plaid in 2020 for about $5 billion. Nevertheless, Anit-trust federal regulators ceased the transaction. Following 2021, Plaid’s performance took a left. With skyrocketing interest and inflation rates, tech companies like Plaid buckled.
The result? Plaid cut over 20% of employees. Zach Perret, CEO of the tech company, stated, “We don’t have a specific IPO timeframe in mind. We’re not in the market. We’re not talking about it.” Plaid may play its cards right later in the year.
Previously known as TripActions, Navan is a travel management company offering services to business customers like corporate cards.
It also provides expense management services. Unlike other companies mentioned, Navan is officially going public. The company filed for an IPO targeted next year.
Navan enlisted Goldman Sachs to assist it through the filing process. In one of its latest funding, the company raised $275 million in a Series F round, placing Navan at a $7.25 billion valuation. Navan took a rough hit in its travel division, earning $0 in revenue during the pandemic.
Nevertheless, the company buckled down on its expense management division, which kept it afloat. Navan found investors willing to raise $125 million to kickstart the department. Some investors included Lightspeed Venture Partners, Andreessen Horowitz, and Zeev Ventures.
The corporate card company came a long way from its pandemic fund. Its latest funding round from a Series G fund of $300 million raised its valuation to over $9.2 billion.
Plenty is an agriculture-based company operating a unique vertical farming production unit. The organization primarily offers greens in stores and online shops like Amazon Fresh.
One of the unique selling points of Plenty’s technique is that it yields fresh produce year-round. Thanks to its indoor tech approach, the organization can preserve fruits and vegetables resiliently against time and climate constraints.
Financially speaking, The company’s latest round comes from a Series E funding of $400 million. The company raised the amount from investors like Moore Capital Management, Softbank Investment Advisors, and Innovation Endeavors. Plenty has a $1.25 billion valuation gaining it a recent unicorn status.
The company has some collaborations. For instance, it collaborated with Driscoll’s to produce an indoor vertical farming unit growing strawberries. With blooming partnerships and tech-agricultural possibilities, the start-up’s IPO is likely possible.
With planet-conscious consumers on the rise, Impossible Foods’ bleeding burger has captured the vegetarian market. The plant-based company’s recent valuation hit over $7 billion.
It comes after a Series G and H funding round raising approximately $500 million. Mirae Asset Global Investments was a primary investor in this amount.
Similar to Plenty, Impossible Foods also expanded through collaborations. The vegetarian food company partnered with Burger King to offer a meatless Whopper on the menu.
The CEO, Pat Brown, expressed his wishes to go public for capital growth from those supporting the organization’s vegetarian vision. Overall, the IPO will likely occur by early 2023.
Whether it’s a tech, social media, agriculture, or travel firm, start-ups are blooming this year. With forecasted growth, some of these start-ups will likely go public.
Overall, the IPO market this year may bode well compared to last year’s fallout. President of NASDAQ, Adena Friedman, noted,
"We are hopeful that the second half of '23 becomes an opportunity for companies to get out, but I would expect a quiet first half.”
It’s also worth noting that the IPO acquisition process is no walk in the park. Companies undergo several transactions from underwriters and SEC regulators before launching their stocks. During that process, they can scope the market and correct their business strategies.
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