Next week might see the last IPO before 2016.
There are rumors that Chinese peer-to-peer loan marketplace Yirendai (YRD) might make an effort at an IPO in 2015. Based on when it filed, Monday is the earliest it could launch according to the JOBS Act. In our December Preview, we suggested that just a handful of companies might come public by year-end, noting that the final tally could fall well short of expectations. If no companies launch next week, even our low prediction may prove overly optimistic. With just one company on the calendar, it is starting to look like the last month of 2015 might be the slowest December since 2008, when no companies came public.
At last: Atlassian alone may shoulder the December IPO market
Enterprise software-maker Atlassian (TEAM) provides collaboration tools, especially for software development and project management. Its products include JIRA (project management), Confluence (content sharing), HipChat (messaging), JIRA Service Desk (service requests) and at least six smaller products. The company provides services to over 51,000 customers, including 79 of the Fortune 100. It does not have a direct sales force, instead using a land-and-expand strategy driven by strong word-of-mouth marketing, free trials and low pricing ($5/user/month/service). The company has been profitable for the past ten years and has achieved scale without any institutional capital. Next Wednesday, Atlassian expects to raise $350 million at a market cap of $4.1 billion. Goldman Sachs, Morgan Stanley, Allen & Company, UBS Investment Bank and Jefferies are the joint bookrunners on the deal.
IPO Market Snapshot
168 IPOs have raised $29.5 billion in 2015; just 44% are trading above their IPO price. The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is down 7% year-to-date, compared to +2% for the S&P 500. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Alibaba (BABA), Synchrony Financial (SYF) and Citizens Financial Group (CFG). The Renaissance International IPO Index is down 2% year-to-date, compared with -4% for the ACWX. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF Holdings include Recruit Holdings and NN Group.
