Global tech IPO activity slows in spite of
record high capital markets
Raman Chitkara
Partner and Global Technology
Industry Leader
PricewaterhouseCoopers LLP
raman.chitkara@us.pwc.com
*Issue size greater than US$40 million
(includes overallotment) and based on
trade date; See Methodology
Welcome to the third quarter 2017 issue of PwC’s Global Technology IPO Review. With 20 tech IPOs and proceeds of
US$5.2 billion, the third quarter saw a 31% drop in volume and a 15% decrease in proceeds from the prior quarter but
an equal number of offerings and only marginally lower proceeds year over year (-3%). Even allowing for typical third
quarter seasonality, however, the overall strength of the capital markets would have suggested a stronger showing. It is
clear that poor aftermarket performance of several Unicorns that completed their IPOs earlier in the year did not foster
an environment of higher risk taking and higher valuations, and this was especially true in the US. As a result, not only
was there only one Unicorn IPO this quarter, it hailed from Argentina, not the US or China. However, activity did pick
up in the last month of the third quarter with 13 of the 20 technology IPOs listing in September, setting a positive stage
for an improved fourth quarter.
Year to date there have been 67 tech IPOs raising US$17.1 billion − the best nine months since 2014 when 84 tech IPOs
raised US$43.7 billion, a spike in proceeds due to the mega Alibaba IPO.
Geographically, Asia accounted for 80% of the tech IPOs (16) in the third quarter, lending additional credence to the
widely held notion that “the center of gravity of the tech world is slowly moving towards the East.” Greater China
(China and Taiwan) continued its domination of tech IPOs with 11. It was followed by South Korea with three and
Japan and India with one each. Europe posted the two largest tech IPOs of the quarter, but the UK was again absent as
it continues to be challenged by transitional issues associated with the Brexit decision. Perhaps the biggest surprise of
the quarter was just one tech IPO in the US. Consistent with past quarters, there was just one cross-border offering,
Argentina’s Despegar.com, the sole Unicorn of the quarter that listed on the NYSE.
In sharp contrast to preceding quarters, Internet Software & Services was number three this quarter raising US$616
million from three IPOs. Electronics led the way with nine IPOs, including the largest of the quarter, raising a
combined US$3.6 billion. Software was second with four IPOs raising US$718 million.
The macro environment remains positive for the IPO market owing to a robust pipeline and upbeat capital markets.
With US and European elections behind us, and barring any unforeseen geopolitical turmoil, the tech IPO market is
poised for a strong finish to the year.
Sincerely,
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