The year 2020 can be defined by many market events ranging from an historical crash and unprecedented levels of volatility. Surprisingly, amid the chaos, 2020 will go down as one of the best years for initial public offerings (IPO).
According to Renaissance Capital, 218 companies went public in 2020, a year-over-year increase of 36.3%, marking the the busiest year since 2014. Those offerings racked in a whopping $78.2 billion. This year can also be defined as the year of the SPAC, or special purpose acquisition company, with 248 blank check companies pricing on public markets.
Consistent with the past few years, growth-oriented sectors like healthcare and technology were the majority of listings, with healthcare accounting for 50% of the overall market. This year's biggest IPO deals came from a mix of tech-enabled giants, software companies, and Chinese electric vehicle names like Airbnb (NASDAQ: ABNB), DoorDash (NYSE: DASH), Li Auto (NASDAQ: LI), Snowflake (NYSE: SNOW), XPeng (NYSE: XPEV) and Unity Software (NYSE: U).
With two vaccines now authorized for emergency use in the United States--developed by Pfizer (NYSE: PFE)-BioNTech (NASDAQ: BNTX) and Moderna (NASDAQ: MRNA)--and a few more to likely be authorized in the new year, the return to more "normal" or predictable market conditions will most likely bring more variety to new listings, benefiting more cyclical companies.
A few big names that may price in 2020 are from a range of industries from communication services and consumer discretionary to information technology and fintech.
Below are companies likely to debut in early 2021:
Affirm Holdings Inc.
Affirm was sent to be a 2020 IPO, but delayed its listing due to the back-to-back blockbuster debuts of Airbnb and DoorDash in early December. The fintech company is apart of the growing buy-now-pay-later consumer lending service that offers 0% interest or simple interest loans to ecommerce shoppers. While popular with Millenials and Gen Z shoppers, Affirm has many competitors and is losing money, according to its initial filing with the U.S. Securities and Exchange Commission (S.E.C.). Affirm could go public as early as January.
Bumble Trading Inc
Bumble had filed confidentially to go public earlier this year, according to Bloomberg, with the dating app provider aiming for a February listing. Rival Match Group (NASDAQ: MTCH) has posting a strong year despite pandemic-related social restrictions, and Bumble is set to benefit from pent up demand for relationships post-pandemic. Bumble has also expanded its reach beyond romantic dating by offering apps that help people make networking connections or search for platonic friends in their area.
Coinbase, Inc.
Coinbase announced earlier this month that the cryptocurrency exchange had filed confidentially to go public, with the company expected to seek an early 2021 IPO amid strong recent rallier from cryptos like Bitcoin. Coinbase operates across 100 countries with over $25 billion assets under management. As long as cryptocurrencies remain stable, Coinbase is expected to be one of the hottest IPOs of 2021.
Robinhood Markets Inc.
Robinhood is looking to go public as soon as the first quarter of 2021, according to Bloomberg sources. The company was a pandemic-favorite, with its business model helping a new generation of investors navigate the stock market. The company was valued at $11.7 billion in its last private round of fundraising and commands about 13 million users.
Roblox Corporation
Roblox also delayed its IPO into early 2021 due to the debuts of Airbnb and DoorDash. The online gaming platform allows users to create and publish their own video games, and makes is revenue through sales of in-game currency. The company has experienced growth in both users and revenue, benefitting from the pandemic-induced recession and stay-at-home market, according to its S.E.C. filing.