2011 IPO Update
By Thomas O. Gephart
January 2, 2012
The U.S. and global IPO markets started spluttering to life in 2009 until about mid-2011 due to competition among global markets, world-record-breaking deals coming out of China, Hong Kong and the United States, and other countries entering the U.S. IPO market. The recovery began to slow when the Greek debt crisis and growing global economic concern put enough fear and uncertainty into the mix. This uncertainty put many of the IPOs on hold, with approximately 200 deals in the pipeline at the end of 2011. The year did end with a total of 159 U.S. IPOs down from 191 in 2010.
However, the size of the IPOs showed improvement. The U.S. had six billion-dollar IPOs in 2011 while only one billion-dollar deal was completed in 2010. Internet companies were the main sector for the big IPOs – Bankrate, Groupon, LinkedIn and Zynga all went public in 2011. But, though the size of some of the 2011 IPOs was impressive, unfortunately by year’s end two thirds of those IPOs were trading below their initial offering price.
What is in store for 2012? Are attitudes over China cooling? Will there be resolution to the global economic uncertainty? We can likely expect a turbulent year.
Ventana was one of the first venture capital groups in Orange County and San Diego, California with syndication of $3.2 billion in more than 100 companies. Ventana’s focus has been on cross-border investing to positively impact economies and job creation at home and abroad.