10 Tech IPOs In The Offing In 2015
It turns out 2014 was a banner year for initial public offerings (IPO). According to a PwC report, the market for initial public offerings in the global technology industry surged in 2014 and was the strongest in 10 years, with 118 offerings resulting in proceeds of US$51.2 billion. Experts believe the momentum will continue this year, as there are dozens of startups hoping for billion-dollar-plus market caps and likely to make their move in the next 12 months, from big data software upstarts to storage technology disruptors.
In recent years, companies such as Alibaba and Facebook had shown that IPOs can be driven by the rapid increase of e-commerce and innovations in mobile and social media, and not pure conventional technologies unlike in the past. Besides, the Internet Software & Services 80 percent of the total technology IPOs in 2014, followed by software at nearly 70 percent.
The 2015 Tech IPO Pipeline has 588 investor-backed private technology companies in the United States today with valuations, real or rumored, of greater than $100 million and who are demonstrating significant momentum, according to CB Insights. While only a handful innovative companies will make a mark this year too, it is important to take a look at some of the companies with a high potential for initial public offerings in 2015.
1. Cloudera: The Hadoop-based company has raised more than $1.2 billion in private equity. The other positive is that it has Intel as a strong partner. As of last May, its valuation was as high as $4.2 billion.
2. DocuSign: A specialist in electronic-signature software and a competitor to Adobe, it closed a $115 million round in October 2014. The company last reported valuation worth $1.6 billion.
3. Dropbox: The six-year-old cloud storage services pioneer needs to justify its $1 billion it has raised over five different rounds and may hit the headline this year.
4. MongoDB: With more than 2,000 customers, the open source database major is seeking to displace proprietary technologies from the likes of Microsoft and Oracle. This year itself, it raised another $80 million round. That’s on top of the $150 million raised in 2013. The valuation number as of mid-January is $1.6 billion.
5. Uber: With a valuation of more than $40 billion thanks to its latest round of financing, the global car-sharing service is going to be one of the most eagerly watched startups this year as a potential IPO candidate. But CEO and cofounder Travis Kalanick has regulatory and legal issues to deal with, including an indictment with his name on it in South Korea, so whether an IPO happens may hinge on those. Therefore, we may not even see it happening this year despite the endless buzz about this company’s massive valuation.
6. Airbnb: The accommodations marketplace, similar to Uber, has faced some regulatory issues in cities that are none too pleased with residents turning their homes into hotels. Even then, it has a rumored valuation of $13 billion, raising the IPO buzz. CEO and cofounder Brian Chesky disagred to an IPO in 2014, and stated that “We will do it at a time when it benefits the company.”
7. Pinterest: Having raised $792 million in funding and fetching a valuation of $5 billion in May 2014, the online scrapbooking site is one of the most-watched startups right now. At the end of December, it began a deeper push into ads or “promoted pins,” a move that may mean that it may be able to truly monetize its massive audience. Its investors such as Andreessen Horowitz and Bessemer Venture Partners are among those in line to benefit in an IPO.
8. Snapchat: Investors believe that the messaging app, which has just started generating revenues, has something even more important: the ability to build up an audience, as Facebook did. When it hired Imran Khan, the Credit Suisse banker behind Alibaba’s IPO earlier this year as chief strategy officer, the IPO chatter volume rose.
9. Spotify: The music-streaming service raised $250 million at a $4 billion valuation in November 2013. Sources told Quartz in March 2014, that it was talking with investment banks for a possible IPO in 2014.But its leadership team is in no hurry. As founder and CEO Daniel Ek told Billboard, “There’s no rush in that and no one is forcing us.”
10. Stripe: After being listed as an Apple partner for Apple Pay, Stripe gained elite status among Silicon Valley startups. Given its $1.75 billion valuation, up from $100 million less than two years ago, it is much regarded as a potential IPO candidate or a target for acquisition in the coming months.
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