There already have been more initial public offerings through the first three quarters of 2021 than there were in all of 1996 during the dot-com boom — the best year ever for IPOs, according to FactSet.
In the first nine months of this year, 953 companies have gone public in the U.S., compared to 664 for all of 1996 and 555 last year. As of Nov. 23, 2021, this is 141.3% more than the same time in 2020, which had 395 IPOs by this date.
Dating app Bumble (BMBL) - Get Free Report, plant-based milk company Oatly (OTLY) - Get Free Report and online brokerage giant Robinhood (HOOD) - Get Free Report are among the more high-profile companies that went public this year. Robinhood popularized no-fee stock trading and was valued at $32 billion.
Startups are taking advantage of low-interest rates and stimulus from the Federal Reserve, and investors are heavily craving rapidly-growing startups amid the boom for SPACs, which have become popular ways for companies that are looking to go public with a little less regulatory scrutiny, CNN reported.
The uptick in SPAC IPOs began in 2019's fourth quarter with the highly successful offerings of Richard Branson's spaceflight company Virgin Galactic (SPCE) - Get Free Report, online betting company DraftKings (DKNG) - Get Free Report, and the scaled-down WeWork (WE) - Get Free Report, which have all gone public by merging with a SPAC.
Former President Donald Trump has plans to merge his new social media company Trump Media & Technology Group with a SPAC, too — Digital World Acquisition (DWACU) - Get Free Report, which also went public in 2021.
But, will the boom of SPACs continue into 2022?
Sara Potter, a marketing content specialist and economic contributor at FactSet, is skeptical. "SPACs are facing much more regulatory scrutiny and some high-profile lawsuits are coming," she said, according to a report for Investor's Business Daily.
Some big firms also are choosing to go public through direct listings of shares on Wall Street exchanges. Video game platform Roblox (RBLX) - Get Free Report, the largest U.S. cryptocurrency exchange Coinbase (COIN,) - Get Free Report and electric vehicle-maker Rivian Automotive (RIVN) - Get Free Report all issued stock directly instead of selling new shares in an IPO. But, after strong debuts, most IPOs taper off after excitement dies down.
The Renaissance IPO ETF (IPO) - Get Free Report, which holds shares of large, high-profile companies that have gone public in the past few years, such as Roblox, Coinbase, Airbnb (ABNB,) - Get Free Report and DoorDash (DASH) - Get Free Report, as of Nov. 23, is down 2.96% for the year. The S&P 500, as of the same date, is up almost 25% in 2021.
But the surge in demand for regular IPOs shows that startups with at least a $1 billion valuation are willing to pursue the old-school way of going public.
"An accommodative market backdrop and elevated valuations have encouraged issuers to go public," said Rachel Gerring, IPO leader for EY Americas, in a report last month. "We are cautiously optimistic that these trends can continue through year-end and into 2022."
"We expect the IPO market to finish the year strong, with a robust pipeline and ample ... backlog to support issuance in the fourth quarter," said analysts at Renaissance Capital, a research and investment firm that focuses on IPOs, in a recent report.
TheStreet has looked at some of the IPOs this year with the biggest returns, along with the percentage gains or losses for their stock, year-to-date.
Here are the Top IPOs of 2021 so far:
Huadi International Group | up 150.77%
Wenzhou, China-based Huadi International Group (HUDI) was founded to design and manufacture steel pipe and related products for use in a variety of end markets and in over 20 countries worldwide. Huadi went public on Jan. 22 and started at a price of $8 per share, closing its initial public offering on Nasdaq at $25 million. Huadi's shares closed at 18.80 on Nov. 23.
Rani Therapeutics | up 145.00%
California-based Rani Therapeutics (RANI) - Get Free Report made its Nasdaq debut on July 30. The share price started at $11 per share, bringing in approximately $73.3 million. After two full days as a public company, by the close of trading on Aug. 3, the share price had dropped to $10.70. Rani shares closed at $26.95 on Nov. 23.
Vera Therapeutics | up 122.52%
Vera Therapeutics (VERA) , a clinical-stage biotechnology company focused on developing and commercializing transformative treatments for patients with serious immunological diseases, went public on May 14. The share price started at $11.41 per share, peaked at $13.15, and closed at $11.50, up 4.5% from the offer price. The biotech sold 4.34 million shares for a total of $47.85 million, Barrons reported.
Affirm Holdings | up 31.23%
Affirm Holdings (AFRM) - Get Free Report, a fintech company that lets users split purchases into several payments, went public on Jan. 13 at $49 per share. The payment-technology company raised $1.2 billion and sold 24.6 million common shares in the offering. Looking into the 2022 financial year, Affirm said it sees gross merchandise volumes rising by as much as 70%, with revenues of between $1.16 billion and $1.19 billion, with both figures excluding the impact of its recent partnership with Amazon Inc. (AMZN) - Get Free Report.
Roblox | up 65.28%
Video game platform Roblox (RBLX) - Get Free Report made its stock market debut on March 10 at $64.50 per share, above the reference price of $45. Shares of Roblox jumped 54.3% to close at $69.47 at the end of its first day of trading and based on the company’s opening trade, Roblox is valued at about $42 billion, The Wall Street Journal reported. The company saw strong third-quarter results and is making strides in the metaverse. Shares closed at $114.88 on Nov. 23.
Volcon | up 38.12%
Volcon ePowersports (VLCN) - Get Free Report, the all-electric, off-road power sports company, went public on Oct. 6 at $5.50 per share. The gross proceeds of the IPO were expected to be approximately $16.6 million before deducting underwriting discounts, commissions, and offering expenses. The EV company had over 1,000 Investors contributing to more than $4.5 million in total funding. Volcon shares closed Nov. 23 at $15.00.
ZIM Integrated Shipping Services | up 378.26%
Israeli international cargo shipping company ZIM Integrated Shipping Services (ZIM) - Get Free Report began trading on the NYSE on Jan. 28 at $15 per share. Citigroup, Goldman Sachs & Co., LLC., and Barclays acted as global coordinators, and Jefferies and Clarksons Platou Securities acted as joint book-runners for the IPO. ZIM shares closed at $55. on Nov. 23.
Society Pass | down 77%
Society Pass (SOPA) - Get Free Report went public on Nov. 9 with a big jump, but the stock has languished since. The IPO launched with 2.9 million shares priced at $9 each, and the next day, the stock skyrocketed to close at $48.30. The Vietnam-based digital technology company listed a $26 million initial public offering. According to a statement released by the company, the IPO marked the first-ever Vietnamese company to make a traditional stock listing outside of its home country. Shares closed at $11.18 on Nov. 23.
Digital World Acquisition | up 297%
Digital World Acquisition Corp. (DWACU) - Get Free Report made its debut at the end of September with an offering of $250 million, consisting of 25,000,000 units at $10 per unit. The SPAC rocketed higher after the announcement of a planned merger with the social media company backed by former President Donald Trump. The agreement between the companies valued Trump Media & Technology Group at $875 million and the combined entity at $1.7 billion, according to The Motley Fool. Digital World Acquisition shares ended Nov. 23 at $39.46.