The US IPO market had a great year in 2021. Nearly 400 companies went public through traditional initial public offerings (IPOs) or reverse mergers with special purpose acquisition companies (SPACs). But in 2022, private companies bucked the course, after inflation and the Federal Reserve’s aggressive rate hikes sent the stock market into freefall.
There have been just 71 IPOs in the U.S. this year, the lowest level since 2009, according to Renaissance Capital, an investment bank that specializes in IPO market research. Total funds raised in public offerings fell even further, to just $7.7 billion from last year’s $142 billion, Renaissance Capital data show.
It usually takes a private company six months to complete its IPO process after submitting its intention to go public by filing an S-1 form with the Securities and Exchange Commission (SEC). But this year, many companies that filed S-1s in 2021 and early 2022 have postponed their IPO plans until at least 2023, hoping the bear market will be over by then.
Here are some of the biggest IPOs you can expect in 2023:
Reddit: $15 billion
Social media site Reddit filed with the SEC to go public in late 2021, at the end of a blockbuster year for IPOs. But the subsequent market crash changed Reddit’s plan, and it still hasn’t announced a firm date for going public yet.
Reddit was last valued at $10 billion after a private fundraising round in August 2021. The company is reportedly seeking a $15 billion valuation for its eventual public debut.
Stripe: $74 billion
Digital payment software company Stripe also filed its intention to go public back in 2021. Stripe was last valued by private investors at $95 billion in March 2021, making it one of the most valuable fintech companies in the world. In July this year, however, the company discounted its own valuation by 28 percent to $74 billion, considering unfavorable market conditions.
The core business is still strong. Last year, Stripe brought in $12 billion in revenue, representing 60 percent year-over-year growth, Forbes reported in May.
There’s a good chance Stripe will go public in 2023, given that the company’s stock awards to some of its early employees face a 2023 expiration date.
Klarna: $6.7 billion
The Swedish fintech startup known for its buy-now-pay-later service has seen its valuation collapse this year. The company was last valued at just under $7 billion in July after a fundraising round. That represents an 85 percent drop from a year earlier when private investors valued the company at nearly $50 billion.
Klarna CEO Sebastian Siemiatkowski expressed an intention to take the company public in an interview in September, but said he wants to wait for stock market volatility to settle before setting any IPO plans.
Clockwork: $25 to $40 billion
Chime, a San Francisco-based digital bank, was reported to be planning an IPO targeting March 2022 at a valuation of $35 billion to $45 billion. But in February, the company said the plan was on hold due to uncertain market conditions.
Chime was last valued at $25 billion by private investors after a fundraising in August 2021. The company has not changed its IPO valuation, according to Forbes.
Instacart: $24 billion
Instacart sought to go public in the US in May, surprising many investors amid the market turmoil. But in October, the grocery supplier said it has decided to delay the IPO until 2023 at the earliest.
Instacart was last valued at $39 billion in March 2021. Since then, the valuation has fallen 40 percent to $24 billion.
Mobileye: $17 billion
Mobileye is an Israel-based developer of autonomous driving technologies owned by Intel. The company filed with the SEC to go public in September. Intel recently priced its IPO at $21 per share, giving Mobileye a $17 billion valuation.
That number is a sharp drop from the $50 billion valuation Mobileye envisioned late last year.
