Snowflake Melts Investor Hearts Like Most Tech IPOs This Year
Comment of the Day

September 21 2020

Commentary by Eoin Treacy

Snowflake Melts Investor Hearts Like Most Tech IPOs This Year

This article by Deniz Besiroglu and Dimitri Quemard for Bloomberg may be of interest to subscribers. Here is a section:

All 12 companies have increased in value since they started trading. The largest increase was Schrodinger Inc. (229.7%), followed by BigCommerce Holdings Inc. (212.3%) and nCino Inc. (143.7%). Shares in Snowflake, the year’s largest U.S. technology IPO, has doubled from its offer price of $120 per share.

Eoin Treacy's view

The number dollar value of IPOs hit a new all-time high this year. That tells us a lot about the ability of low interest rates and abundant liquidity to boost asset prices. That’s particularly true for private assets since there is no mark to market value. Profitability is habitually somewhere out in the future for many new companies so the early investors are taking the opportunity to sell in IPOs before that issue becomes pressing.

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