In the midst of a pandemic, election year, and tumultuous stock market, 2020 is delivering something that wasn’t forecasted by many tech insiders back in 2019 - a flurry of technology IPOs.
An IPO, or initial public offering, is when a company transitions from being privately held to becoming listed on a public exchange like the Nasdaq. It’s a big liquidity event when startup founders, early employees, and investors finally get to realize the financial gains that they’ve worked so hard for.
Companies like Uber, Slack, and others that went public last year are now leaving many investors disappointed because of less-than-expected performance. However, companies like Zoom and Fastly have seen the exact opposite, with astronomical gains that few could have predicted.
Here are the companies that have recently gone public or are slated to in 2020:
If you are a customer of any of these companies and you firmly believe in their product/service and mission, ask yourself whether or not you should become a partial owner in the company.
I’m always reminded about how in 2008, if you would have taken the money you would have otherwise used to buy an iPhone and instead invested it in Apple’s stock, the returns would have yielded you a healthy return on investment.
All of that said, tread very cautiously. It’s been very clear to me that some of these stocks are getting priced at valuations that don’t make it appealing for retail investors like myself. While I am excited to see more liquidity events that help reward the early risk-takers at startups, it’s always important to invest in things that are fairly valued.
If you don’t find appeal in any of these specific companies, hang tight - 2021 might have another round of interesting tech companies worth considering.
What companies, either public or private, most interest you right now?
[Obvious disclaimer: I’m not an expert and this is not meant to be financial advice. Talk to a financial expert before making any investment decisions.]