A closer look IPOs and Shifting Market Trends

Barbara (Bree) Sterne

Feb 23, 2021
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In Brief

  • Despite a volatile year for equities, the IPO (initial public offering) market proved to be surprisingly strong in 2020, and many signs indicate IPO volume will remain elevated in 2021. 
  • The recent IPO boom diverges from the past two decades, which saw a decline in listed public companies as many firms opted to remain private longer and merger and acquisition activity increased relative to public offerings. 
  • Despite comparisons to the dot-com bubble of the late 1990s, recent IPOs differ from prior waves in several key ways. Additionally, the IPO process itself is changing with a rise in direct listings and SPACs (special purpose acquisition companies). 
  • Bessemer’s approach has been to employ disciplined fundamental analysis when evaluating investments in newly public companies. Bessemer portfolios with alternatives have benefited from investments in early-stage growth companies, many of which have recently gone public.

 

 
Investment Strategist