Register for IPO Updates
US IPO Stats
IPO Industry Breakdown
Largest Global IPOs
Largest US IPOs
IPO News Archive
New Ways to Invest in IPOs - IPO ETFs
Big Blue's big data buyout: Tech startups choose billion-dollar sales over IPOs
Analyst IPO Market Commentary
Most tech entrepreneurs would choose to forge their own path than, say, work for IBM or Cisco.
Yet in the past month, three big-data tech firms that had reportedly hired banks to lead IPOs have instead opted for sales totaling $4.5 billion.
A difficult market for tech
Given 2016's tumultuous market, cashing out could be preferable to the low valuations available from an IPO. The Vix Volatility Index has been elevated for six months, and has risen so far in 2016. Only four companies have been able to go public this year, all biotechs with substantial insider support. Broader market indices are down across the board, and multiples in the tech sector have been crushed. A whopping 74% of IPOs from last year trade below the offer price, and the year's average return from IPO is -22%
Three big data companies acquired in February; previously selected banks for an IPO
Truven Health Analytics
$600 mil ('15)
~$130 mil ('16)
~$175 mil ('15)
A provider of US healthcare data for hospitals and others,
Truven Health Analytics was acquired for $2.6 billion
- well below the $3 billion price it had reportedly sought when it selected banks for an IPO in March 2015. Closest peer Inovalon (
) now trades 27% below its February 2015 offer price.
Internet-of-Things company Jasper was acquired by Cisco for $1.4 billion
, nearly the same valuation it achieved in April 2014 before selecting banks that November for an IPO. Jasper had notable backers, including Benchmark, Sequoia and AllianceBernstein.
In a PE-to-PE sale,
driving camera company Lytx was acquired for more than $500 million
by GTCR. Backed by Insight Venture Partners, WCAS and others, the company reportedly selected banks in June 2013 for an IPO, and added a new CFO in April 2015.
Acquisitions have held steady, but IPO activity has slowed sharply.
Several large IPO-bound companies were acquired after markets began tumbling last year - Petco, Ballast Point and IDC to name a few - and the trend has continued in 2016. Since September, 10 companies have achieved an enterprise more than $1 billion at IPO, and 10 pre-IPO companies we track have announced they would be acquired for $1 billion or more.
Keywords / Tickers: IBM, CSCO, Jasper, Truven, Lytx
ETF Express Award:
ETFExpress awards are based on a 'peer review system' whereby readers - including institutional and high net worth investors as well as managers and other industry professionals at fund administrators, brokers, custodians and advisers - are invited to elect a 'best in class' in a series of categories via an online survey. In each category, the firms with the most votes at the end of the voting period are subject to a final review by ETFExpress's Senior Editorial team.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Investors should consider the investment objectives, risks, charges and expenses carefully before investing.
As stated in the Prospectus, the total annual operating expenses for the Fund was 3.48%. The Adviser has contractually agreed to keep net expenses from exceeding 2.50% of the Fund's average daily net assets for at least a year from the date of the Prospectus and for an indefinite period thereafter subject to annual re-approval of the agreement by the Board of Trustees.
An investor cannot invest directly in an index. Index returns do not represent Fund returns. The Index does not charge management fees or brokerage expenses, nor does the Index lend securities, and no revenues from securities lending were added to the performance shown.
Definitions: Net Asset Value (NAV) of the fund is calculated by dividing the total value of all the securities in its portfolio, less any liabilities, by the number of fund shares outstanding. Market Price is current value at which an asset or service can be bought or sold. Premium/Discount is provided to show the comparison of the daily net asset value (NAV) and the midpoint of the closing bid/ask for each of the funds. The
Renaissance IPO Index® (IPOUSA)
is a stock market index based upon a portfolio of U.S.-listed newly public companies that includes securities prior to their inclusion in core U.S. equity portfolios. The
Renaissance International IPO Index® (IPOXUS)
is a stock market index based upon a portfolio of newly public companies listed on non-U.S. exchanges. The S&P 500® Index (SPX) is a stock market index which includes 500 U.S. listed companies and seeks to capture approximately 80% coverage of available U.S. market capitalization.
Risk Disclosure: Investments in the
Renaissance IPO ETF, symbol "IPO"
Renaissance International IPO ETF, symbol "IPOS"
(the "ETFs"), and the
Global IPO Fund, symbol "IPOSX"
(the "Mutual Fund") are subject to investment risk, including possible loss of the principal amounts invested. The ETFs and the Mutual Fund (the "Funds") invest in companies that have recently completed initial public offerings. These stocks are unseasoned equities lacking trading history, a track record of reporting to investors and widely available research coverage which many result in extreme price volatility. Due to a greater number of IPOs in certain segments, the Funds may also be subject to information technology and financial sector risk, small and mid-capitalization company risk, and, for the Renaissance International IPO ETF, emerging markets risk. The Funds may hold securities in the form of Depository Receipts, REITs, and Partnership Units which have greater risks than common shares. The strategies have high portfolio turnover and securities lending risks. The returns of the ETFs may not match the return of the respective indices. The ETFs are classified as non-diversified investment companies subject to concentration risk.
Prospectus: Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus and/or summary prospectus with this and other information, please visit
. Read the prospectus carefully before investing. Renaissance Capital Investments, Inc., distributor for the Mutual Fund. Foreside Fund Services, LLC, distributor for the ETFs, 1-866-486-6645.
Definitions: The Renaissance IPO Index® is a stock market index based upon a portfolio of U.S.-listed newly public companies that includes securities prior to their inclusion in core U.S. equity portfolios. The S&P 500® Index is a stock market index based on the market capitalizations of 500 large companies whose common stock is publicly traded on the NYSE.
The information contained herein is proprietary and copyrighted. The media is welcome to use our information and ideas, provided that the following sourcing is included: Renaissance Capital - manager of IPO-focused ETFs.
The information and opinions expressed herein were prepared by Renaissance Capital's research analysts and do not constitute an offer to buy or sell any security. Renaissance Capital, the Renaissance IPO ETF (symbol: IPO), the Renaissance International IPO ETF (symbol: IPOS), or the Global IPO Fund (symbol: IPOSX), may have investments in securities of companies mentioned.
Register for Updates
Renaissance Capital LLC is an SEC-registered investment adviser.
Renaissance Capital Investments, Inc. is a
-registered broker-dealer, and member of
© 2016 Renaissance Capital LLC. All rights reserved.