US IPO Weekly Recap: Coupang completes year's largest IPO and Roblox direct-lists in a 7 IPO week

A total of 32 companies entered the public market this past week, with the week’s 7 IPOs joined by one direct listing and 24 SPACs.

In the largest US IPO of the year to date, Coupang (CPNG) upsized and priced above the upwardly revised range to raise $4.6 billion at a $62.9 billion market cap. The largest e-commerce player in Korea, Coupang nearly doubled revenue in 2020 and has expanded its margins in recent years. Coupang is unprofitable, and significant investments in fulfillment will weigh on cash flow in the near term. Coupang finished the week up 39%.

Online gaming platform Roblox (RBLX) completed the year’s first direct listing, opening 43% above its reference price and beginning trading at $64.50 for an implied $41.8 billion market cap. Unprofitable with strong free cash flow, the company’s growth has been accelerated by the pandemic. However, it relies on just 1% of players for all of its revenue. From its opening price, Roblox finished up 8%.

Pool equipment supplier Hayward Holdings (HAYW) priced at the low end to raise $685 million at a $4.1 billion market cap. The company is profitable and has generated strong and improving margins. Revenue growth has been inconsistent, though it accelerated in 2020 as COVID-19 accelerated interest in outdoor living spaces. Hayward finished flat.

IBD biotech Prometheus Biosciences (RXDX) further upsized and priced at the top of the upwardly revised range to raise $190 million at a $782 million market cap. Its lead candidate began a Phase 1a trial in healthy volunteers in December 2020, and is expected to start a Phase 2 trial in ulcerative colitis and a Phase 1b trial in Crohn's disease in the 3Q21, with data readouts in the 2H22. Prometheus finished up 33%.

Fabric and crafts retailer JOANN (JOAN) priced well below the range to raise $131 million at a $505 million market cap. Boosted by stay-at-home orders, the company has recently improved margins and profitability. While it has a poor long-term growth track record, JOANN has seen growth in both comp store sales and its e-commerce segment, though it may revert post-pandemic. JOANN finished up 2%.

Neuro disease biotech Longboard Pharmaceuticals (LBPH) priced at the high end to raise $80 million at a $283 million market cap. Formed by Arena Pharmaceuticals, Longboard's lead candidate is being advanced in a multiple-ascending dose portion of a Phase 1 trial. The company expects to initiate a Phase 1b/2a trial for the treatment of developmental and epileptic encephalopathies in the 1Q22. Longboard finished up 4%.

First High-School Education Group (FHS) priced at the midpoint to raise $75 million at a $289 million market cap. Originally established to provide after-school tutoring services, First High-School has since developed a network of 19 schools, becoming the third largest operator in China by student enrollment as of December 31, 2019. First High-School finished down 24%.

Tel Aviv-listed MeaTech 3D (MITC) raised $25 million at a $119 million market cap. MeaTech 3D is initially focused on developing cultured meat steak technology. In the 3Q20, the company successfully printed meat tissue from stem cells. The company has not generated any revenues and does not expect to in the near term. MeaTech 3D finished down 3%.

24 SPACs raised $6.6 billion this past week, led by Vector Capital’s second tech-focused blank check company Vector Acquisition II (VAQC), which raised $450 million.

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Six IPOs joined the pipeline this past week. Digital banking platform Alkami Technology (ALKT) filed for an estimated $250 million IPO. Low-cost airline Frontier Group Holdings (FRNT), cross-border e-commerce platform Global-E Online (GLBL, and Chinese charging station provider Smart Share Global (EM) all filed to raise $100 million. OTC-listed Mechanical Technology (MKTY) filed for a $12 million Nasdaq uplisting, and micro-cap online gambling platform Esports Technologies (EBET) filed to raise $10 million.

46 SPACs submitted initial filings, led by the Virgin Group’s third SPAC Virgin Group Acquisition III (VIII.U), which filed to raise $500 million.


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IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 3/11/21, the Renaissance IPO Index was up 2.5% year-to-date, while the S&P 500 was up 4.9%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Uber (UBER) and Zoom Video (ZM). The Renaissance International IPO Index was down 1.7% year-to-date, while the ACWX was up 5.5%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include SoftBank and Nexi.