The surge in initial public offerings that began in 2020 has continued in 2021 as well. As of November 12, more than 900 companies have debuted on U.S. stock markets through IPOs this year, making 2021 the best year for IPOs in 20 years. 

 Source: Stock analysis 

IPO 1: Rivian Automotive, Inc. (RIVN)

 Rivian, an electric vehicle startup, raised $11.9 billion in its initial public offering on November 10, making it the largest IPO for an American company since Facebook. On the first day of trading, Rivian shares opened 50% above the IPO price, and the stock closed 29% above the IPO price making it the sixth-largest IPO ever on a U.S. stock exchange. 

Rivian Automotive is an American electric vehicle manufacturer and the first automaker to introduce a fully electric truck, the R1T, in September 2021, beating industry leaders Tesla, GM, and Ford. Its IPO couldn’t have come at a better time, as investors seek to profit from the fast-growing EV market, which has become one of the most talked-about industries in 

the recent past. However, Rivian is still a long way from scaling up its production to achieve profitability, and the global semiconductor scarcity has made it difficult for the company to ramp up the production of new vehicles. Long-term-oriented investors focused on fast-growing sectors are likely to find Rivian stock an attractive bet given the long-term growth potential for the company. 

IPO 2: Coinbase Global, Inc. (COIN) 

Coinbase, one of the largest cryptocurrency exchanges in the world, went public on April 14 by listing its equity securities on Nasdaq in a direct stock listing. The stock closed 31% above the initial reference price on the first trading day, giving the company a massive $85.8 billion valuation. 

Coinbase is an American cryptocurrency trading platform founded in 2012 and is known for its secure and user-friendly technology. The company provides Bitcoin trading and related investment products to both retail and institutional clients. According to Statista, Coinbase is the world’s fourth-largest cryptocurrency exchange based on 24h volume on November 08. The company has grown in popularity in recent years to become one of the most popular platforms for investors interested in digital currencies by offering a simplified crypto trading experience. Coinbase now has 73 million verified users, 106,000 institutions, and 185,000 ecosystem partners in over 100 countries. 

In recent years, both retail and institutional investors have become interested in digital currencies. Bitcoin was the best-performing asset class in 2020 and continues to gain attention because of the rising acceptance of cryptocurrencies by large financial institutions such as PayPal, Inc., (PYPL). The crypto economy is still in its early stages, however, the outlook for the industry appears very promising because of the increasing demand for digital assets and the introduction of new technologies. The global cryptocurrency trading market is projected to grow at a compounded annual growth rate of 30% through 2026, according to Facts and Factors Market Research. Coinbase has played a key role in making digital currencies more accessible to a wider public so far and is likely to remain as one of the key players in this industry in the foreseeable future. 

IPO 3: DiDi Global Inc. (DIDI) 

DiDi, the leading ride-hailing company in China, went public on the New York Stock Exchange on June 30, raising $4.4 billion in its IPO. Despite the ongoing regulatory scrutiny on Chinese tech companies, DiDi Global managed to attract many high-growth investors to its IPO because of the strong growth prospects for the Chinese economy and the global ride-sharing industry. 

DiDi Global is based in China and the company is a developer and provider of app-based transportation services that allow its users to hire a vehicle at an affordable price. DiDi also offers on-demand delivery services, as well as automobile services such as sales, leasing, financing, fleet operation, and EV charging, in addition to transportation services such as taxi hailing, private car-hailing, ridesharing, and bike-sharing. DiDi gained attention for effectively driving Uber out of the Chinese market after the world’s leading rideshare company lost a price war and was forced to sell its China operations to DiDi. The company 

serves more than 550 million customers in Asia-Pacific, Africa, Latin America, Central Asia, and Russia, and is one of the world’s largest ride-hailing companies. 

Chinese officials have started scrutinizing tech businesses more closely in recent months, and this is the number one risk that needs to be monitored by investors carefully when investing in DiDi Global stock. Chinese regulators are concerned about how tech companies store and share data outside of the country. When China’s internet regulator recently announced a cybersecurity investigation and prevented DiDi from taking new user registrations and removing its smartphone app, DiDi stock declined sharply. The long-term outlook for the company, however, remains promising. 

IPO 4: Coupang, Inc. (CPNG) 

Coupang, a Seoul-based e-commerce company, went public on March 11, selling 130 million shares at $35 per share. The stock closed 41% above the IPO price, giving the company a market capitalization of $84.47 billion at the end of the first trading day. 

Coupang is a South Korean e-commerce company that is also called “South Korea’s Amazon.” The company provides services such as same-day and next-day delivery of groceries and general products and also owns Coupang Eats which is focused on the delivery of prepared dishes and Coupang Play which is the video streaming arm of the company. From fresh vegetables to tablets, shoppers can choose from millions of products on Coupang, many of which are available for overnight or same-day delivery. Beijing, Los Angeles, Seattle, Seoul, Singapore, Shanghai, Silicon Valley, Taipei, and Tokyo are among the company’s major markets. Coupang’s speedy delivery service, which is powered by Rocket Delivery – its own logistics division – gives the company a competitive advantage in the South Korean market, and Coupang Eats is the most downloaded app on iOS and the second most downloaded app on Android in South Korea. 

Coupang has also initiated a sustainable delivery option that eliminates the need for cardboard boxes and bubble wrap for 75% of deliveries. Coupang Fresh, the company’s market-leading online grocery service, sends groceries in reusable containers that customers can leave by the door which is then collected by a member of Coupang’s delivery personnel for reuse. 

IPO 5: UiPath Inc. (PATH) 

UiPath, a global software company based in the United States, went public on the New York Stock Exchange on April 21, offering 23.9 million shares at $56 per share. The stock closed 23.2% above its IPO price on the first trading day, valuing the company at $35.8 billion. 

UiPath is a popular robotic process automation software company that monitors user activity to automate a repetitive task. The company’s revenue increased 40% year-over-year in the second quarter of fiscal 2022. Annualized Renewal Run Rate (ARR) increased by 60% as well, which is used to monitor the company’s capacity to acquire new subscription customers as well as retain its existing subscribers. The software provider was named a Process Mining Leader in the Technology Vendor Landscape for the second year in a row in 2021 as well, and the stellar growth in revenue in the last couple of quarters suggest UiPath 

is well-positioned to benefit from the favorable macroeconomic outlook facing the robotic process automation software industry. 

The Bottom Line

The number of companies that have gone public in 2021 is nearly double the number of IPOs registered in 2020. These companies have reaped the rewards of a global shift in the office culture, consumer buying behavior, and the growing popularity of ESG practices. 

IPOs are always on investors’ watchlists because these security offerings have the potential to generate massive capital gains in both the short and long run. Although investing in initial public offerings is appealing, it is not easy for average investors to do so because of their limited knowledge about the listing process. Another reason for not being able to participate in IPOs is a lack of knowledge of new companies and industries with strong growth prospects. Technological advancements such as Artificial Intelligence and machine learning have given birth to many new industries that are shaping the future of human lives. Investing in these companies before they go on to become global giants could turn out to be a great move, and there are many benefits attached to pre-IPO investing such as being able to take part in the growth story of a young company at an early stage, the availability of discounted prices when purchasing shares of a company at the pre-IPO stage, and the possibility of locking in handsome returns once the company decides to go public. 

The Spaventa Group is a pioneer in providing alternative investment products, including pre-IPO investments, alternative funds, cryptocurrency investments, and venture capital funds. Contact The Spaventa Group today to learn more about how these investment solutions could add value to your portfolio.