Why the IPO markets aren’t quite the dotcom bubble all over again

August 4, 2021, 2:47 PM UTC

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The now common phrase, that the pandemic has “accelerated digital trends,” has more recently been matched in volume by prognostications that “it feels like 1999 again” in the world of finance.

And the numbers at least do back it up: As Robinhood and Duolingo went public last week, they were accompanied by 17 other listings in the U.S.—the most listings in a seven-day period since 2000. And it wasn’t just a single, bizarre week: The IPO market in the first half of the year hit a 20-year high globally, per EY.

But in many ways, the IPO market is quite a different beast than it was in 1999. As Ben Carlson, writing for Fortune’s Quarterly Investment Guide noted, the majority of companies going public in the heat of the dotcom boom were microcap businesses—smaller companies with often dubious business models. But there are signs companies going public today tend to be larger: While total amounts raised In 1999 across 547 offerings was around $107.9 billion, those same figures sat at about $167.4 billion across 456 companies in 2020—suggesting each offering raised more in 2020 than in 1999, and therefore likely represented a larger company.

And while the dotcom bubble may be best remembered for the slew of companies that went public by obfuscating their lack of a business model by simply slapping “.com” onto the tail-end of their names, companies going public in 2020 are also older. In 1999, per data from University of Florida Professor (and IPO data guru) Jay Ritter, the median age of companies—excluding special purpose acquisition companies—going public sat at five years. Last year, that figure was nine.

Granted, there are no shortage of exceptions to this idea of companies being more established now at IPO than in 1999: While many expect special purpose acquisition companies, effectively shell companies created to acquire another business, to stick around, the growing pains will burn many. Due in part to a lack of regulation in the space, many SPACs are going to market currently with zero revenue. But SPACs also weren’t quite as big of a player in 1999 as they are today.

So yes, on surface, it may feel a lot like 1999 again with a run-up in tech stocks—but the dynamics underlying this market—both the good and the bad—are quite different.

VENTURE CAPITAL GETS HACKED: Any company that deals with financing or moving large amounts of money has a big target on their backs in the eye of hackers. TechCrunch notes that Advanced Technology Ventures disclosed a ransomware attack to the Maine attorney general’s office recently, in which criminals stole the information of its limited partners. ATV noted that it had yet to see any misuse or abuse of that information.

But it is worth noting that ATV is not the only venture investor to get breached. Axios in February reported that Sequoia Capital was also the victim of a phishing attack. Hackers go after the money—and right now, there’s a whole lot of it in venture capital.

Lucinda Shen

Jessica Mathews compiled the IPO and SPAC sections of this newsletter.


- Inceptio Technology, a Shanghai-based autonomous driving truck tech company, raised $270 million in Series B funding. JD Logistics, Meituan, and PAG led the round and were joined by investors including Deppon Express, IDG Capital, CMB International, SDIC, Mirae Asset, Eight Roads, and Broad Vision Funds.

- Sonoma Biotherapeutics, a South San Francisco and Seattle-based immune tolerance company, raised $265 million in Series B funding. Ally Bridge Group led the round and was joined by investors including ArrowMark, Avidity Partners, and Casdin Capital.

- FullStory, an Atlanta-based digital analytics platform, raised $103 million in Series D funding. Permira’s growth fund led the round and was joined by investors including Kleiner Perkins, GV, Stripes, Dell Technologies Capital, Salesforce Ventures, and Glynn Capital.

- Hopin, a London-based online events tech company, is seeking funding at a $7 billion valuation, per Bloomberg.

- Chronus, a Seattle-based maker of mentoring software, raised $78 million from Level Equity

- Elroy Air, a cargo drone maker, raised $40 million in Series A funding. Investors included Lockheed Martin’s venture capital arm, Marlinspike Capital, and Prosperity7.

- Novakid, a San Francisco-based language learning platform, raised $35 million in Series B funding. Owl Ventures and Goodwater Capital led the round and were joined by investors including PortfoLion, TMT Investments, Xploration Capital, LearnStart, LETA Capital, and BonAngels.

- Zeni, a Palo Alto fintech company, raised $34 million in Series B funding. Elevation Capital led the round and was joined by investors including Think Investments and Neeraj Arora.

- Buildots, a maker of construction tech, raised $30 million in Series B funding. Lightspeed Venture Partners led the round and was joined by investors including TLV Partners, Future Energy Ventures, and Tidhar Construction Group.

- Iterative Scopes, a Cambridge, Mass.-based gastroenterology medicine company, raised $30 million in Series A funding. Obvious Ventures led the round and was joined by investors including Eli Lilly, Johnson & Johnson Innovation, Breyer Capital, and Seae Ventures.

- Connections Health Solutions, Phoenix-based behavioral-health-crisis-focused business, raised $30 million. Heritage Group led the round.

- MakerSights, a San Francisco-based software platform, raised $25 million in Series B funding. G2 Venture Partners led the round.

- Localize, a New York City-based real estate tech firm, raised $25 million in Series C funding. Pitango Growth led the round and was joined by investors including Mizrahi-Tefahot.

- Rentable, a Madison, Wis.-based apartment rental platform, raised $22.5 million in Series B funding. Susquehanna Growth Equity led the round.

- Wildfire Systems, a Solana Beach, Calif.-based financial tech platform, raised $15 million in Series A funding. TTV Capital and QED Investors led the round and were joined by investors including B Capital, the George Kaiser Family Foundation, Daher Capital, Mucker Capital, Bonfire Ventures, Moonshots Capital, and BAM Ventures.

- Planted, a Swiss alternative protein maker, raised  CHF 19 million ($21 million USD) in funding. Investors included Vorwerk Ventures, Gullspång Re:food, Movendo Capital, Good Seed Ventures, Joyance, ACE & Company, and Be8 Ventures.

- SeQure Dx, a Boston-based gene editing company, raised a $17.5 million Series A round. RiverVest Venture Partners and Mass General Brigham Ventures led the round.

- Onsurity, a Bangalore, India-based employee healthcare platform aimed at small businesses and startups, has raised $16 million in Series A funding. Quona Capital led the round, and was joined by Nexus Venture Partners and Whiteboard Capital, with participation from Clover Healthcare founder and CEO Vivek Garipalli.

- Suma Brands, a buyer of Amazon-based brands, raised $12.5 million in equity. Pace Capital and Material led the round.

- Quaise, a Cambridge, Mass.-based energy company focused on drilling technology to access deep geothermal energy, raised $12 million. Nabors Industries led the round.

- Data Gumbo, a Houston-based  blockchain company, raised $7.7 million. Equinor Ventures led the round and was joined by investors including Saudi Aramco Energy Ventures and L37.

- baraka, a Middle East-focused fintech startup, raised $4 million in pre-seed funding. Investors included Global Founders Capital, FJ Labs, Raptor Group, Tribe Capital, Nuwa Capital, VentureSouq, and Class 5 Global. 

- Supercritical, a London-based software platform, raised £2 million in pre-seed funding led by LocalGlobe. 

- Revery, a San Francisco-based  wellness company using gamification, raised $2 million in pre-seed funding. Surge, Sequoia Capital’s program for India and Southeast Asia, led the round.

- Pluralytics, a Minneapolis-based natural language processing startup, raised $1 million in seed funding. Ecliptic Capital led the round.


- Carlyle invested in Abrigo, an Austin-based software provider to financial institutions, valuing it over $1 billion, per Bloomberg. 

- Ardian agreed to invest in YT Industries, a German mountain bike brand. Financial terms weren't disclosed.

- CentroMotion, backed by One Rock Capital Partners, acquired Carlisle Brake & Friction, a Medina, Oh.-based maker of clutches and brakes, from Carlisle Companies. Financial terms weren't disclosed.

- IntelliBridge, backed by Enlightenment Capital, acquired U.Group, an Arlington, Va.-based provider of data science, and analytic solutions to homeland security, defense, and federal civilian agencies. Financial terms weren't disclosed.

- Fencing Supply Group, backed by The Sterling Group, acquired Sharon Fence, a Sharon, Penn.-based fencing supply company. Financial terms weren't disclosed.

- Consolidated Hospitality Supplies Holdings, backed by HCI Equity Partners acquired the inventory and select North American operating assets of American Hotel Register Company, a supplier to the hospitality industry. Financial terms weren't disclosed.

- Sophos, backed by Thoma Bravo, agreed to acquire Refactr, a Bellevue, Wash.-based cybersecurity business. Financial terms weren't disclosed.


- Apax Partners acquired and merged two software businesses into portfolio company Cybergrants in a deal worth $2 billion. It acquired EveryAction, a Washington D.C.-based software maker for non-profits, from Insight Partners. It also acquired Social Solutions, an Austin-based maker of tech for social workers, from Vista Equity Partners.

- Clean Harbors (NYSE: CLH) agreed to acquire HydroChemPSC, a provider of industrial cleaning, specialty maintenance and utilities services, for about $1.3 billion from Littlejohn & Co.

- Marvell agreed to acquire Innovium, a San Jose-based semiconductor company, for $1.1 billion in stock. Innovium is backed by investors including Premji Invest and Redline Capital Management.

- Reliance Steel & Aluminum Co. (NYSE:RS) agreed to acquire Merfish United, a distributor of tubular building products, from One Equity Partners. Financial terms weren't disclosed.


- Sanofi (Stock: SAN) will acquire Translate Bio (NASDAQ: TBIO), a Lexington, Mass.-based clinical-stage mRNA therapeutics company valuing it at about $3.2 billion on a fully-diluted basis.

- The U.K. government is considering blocking Nvidia's $40 billion acquisition of Arm, a British chip designer, per Bloomberg.


- Tivic Health Systems, a Newark, Calif.-based sinus pain relief company, filed for an initial public offering. The company posted $860,000 in total revenue in 2020 and reported a net loss of $3.6 million.

- Bausch Health, a Bridgewater, New Jersey and Quebec-based health care product company, is reportedly planning to take its Solta Medical aesthetics unit public, per Bloomberg.


- Pico, a New York City-based financial markets tech company, agreed to go public via merger with FTAC Athena Acquisition Corp., a blank check company backed by Betsy Cohen. The deal values the firm at about $1.8 billion.

- Hydrow, a Cambridge, Mass.-based rowing machine company, is in talks to go public via an acquisition with Sandbridge X2 Corp., a SPAC, per Bloomberg.


- Moderne Ventures, a Chicago-based early-stage venture capital firm, raised a $200 million fund.

- Yaletown Partners, a Canadian investor, raised $200 million for its Innovation Growth Fund II.

- Work-Bench, a New York City-based enterprise-tech-focused investor, raised $100 million for Fund 3. 

- Tsingyuan Ventures, a Los Altos, Calif.-based seed-stage investor, raised a $100 million fund. It also rebranded as Foothill Ventures.


- NewView Capital, a Burlingame, Calif.-based investment firm, added Ben Fu as a partner. 

- Eclipse Ventures, a Palo Alto, Calif.-based firm focused on tech for essential industries, named Aidan Madigan-Curtis and Jay Knafel as partners.

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