IPOs are back!
After 2–3 years of “drought,” it looks like the party is starting again. And judging by the explosive debut of Figma on the stock exchange, it’s definitely not going to be boring!
For years, IPOs have been the ultimate thermometer of investor sentiment. They’ve always worked like a “crash test” for how much liquidity exists in the market, how much confidence there is in leading sectors, and, of course, who really has value. And now, after nearly three years of sluggishness, we’re finally seeing some light at the end of the tunnel.
FIGMA
Figma made a very dynamic entrance into the world of markets, as its stock… TRIPLED on its very first day of trading!
Yes, you heard that right. From the $33 IPO price, it closed at $115.50, giving it a valuation of nearly $68 billion. And we’re talking about a company that almost got acquired by Adobe for $20 billion two years ago, but the deal fell through due to antitrust concerns. In the end, that might have turned out to be a good thing…
Figma now counts more than 13 million monthly users, with partnerships with Google, Microsoft, Netflix, and Uber. Not bad at all for a startup founded in 2012 by a 33-year-old CEO.
KLARNA IPO
And after Figma , who’s next to take the baton? Klarna!
The well-known Swedish fintech company is preparing to list on the NYSE with the ticker KLAR, offering more than 34 million shares at a price between $35 and $37. If demand is strong, the valuation could reach up to $14 billion! This is one of the most anticipated IPOs of the year, as Klarna has built a massive brand in the digital payments space.
What’s interesting here is that only 5.5 million shares are being issued directly by the company. The rest belong to existing shareholders—venture capital funds that decided to sell part of their holdings. In other words, they’re looking to “cash out.” Among them are giants like Sequoia Capital and SoftBank.
Klarna became famous with the “Buy Now, Pay Later” model, but it has since expanded into debit cards, savings accounts, and smart budgeting tools. In the last quarter, it reported a 20% increase in revenue, reaching $823 million, though it still posted a $53 million loss. What’s striking is that the company’s valuation once peaked at $45 billion in 2021, only to crash to $6.7 billion in 2022 due to global turmoil and rising interest rates.
And now? Now it seems to be coming back stronger. Klarna’s IPO is seen as a bellwether for the rest of the year’s IPO activity. And if it goes well, we’ll likely see more companies take the big step—from AI to biotech to clean energy. It’s like we’ve moved from the phase of “let’s all go public just because we can” to “let’s go public because we actually have something solid to show.”
MARKETS COME ALIVE AGAIN
Because, folks, from the 2023 lows, IPO interest is back! And this time, not with bubbles and craziness like in 2021, when even I could go public.
No. This time, the companies hitting the markets are more mature, more organized, and more… aware. And that’s good for us investors and for the market overall.
We’re seeing IPOs from tech companies, healthcare, AI, and even more traditional sectors that have undergone digital transformation. This shows that the market is not only waking up—it’s evolving.
Are IPOs good for the markets? OF COURSE! And here are 6 reasons why:
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More choices for investors: From tech startups to stable businesses, our investment “basket” gets bigger.
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Capital diversification & democratization: Risk and opportunity spread to more hands.
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Greater transparency: Publicly listed companies are required to publish financials, raising market standards.
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Liquidity and depth: More shares mean livelier and more efficient markets.
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Innovation and trends: Access to cutting-edge fields like AI, biotech, and fintech.
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Prestige and growth: Strengthening international reputation and attracting foreign capital.
Put together, these factors lead to a healthier and more dynamic market—one where even those who don’t directly participate still benefit indirectly.
Posted Using INLEO