We’ve talked before about a hot summer of IPOs, but with SpaceX just hitting the public markets and Anthropic and (possibly) OpenAI coming soon, it’s easy to overlook the sheer scale of what’s happening.
We were reminded of that in Wednesday’s NCVA-Pitchbook Venture Monitor report. Unsurprisingly, all the money in the private market is going into AI. But one particular number stood out. Considering the pending OpenAI and Anthropic IPOs, the report highlights key points such as: “Together with the SpaceX IPO, these IPOs will create more value than all U.S. VC-backed IPOs since 2000.”
That’s quite a claim, and when you add up the numbers, it’s hard to agree. SpaceX has already gone public at a valuation of $1.77 trillion, and with Anthropic and OpenAI both in the trillions, the three companies combined are likely to reach somewhere north of $4 trillion. By comparison, the U.S. Securities and Exchange Commission recorded just $70 billion in U.S.-based IPO proceeds last year.
Careful readers will notice that there are several caveats to this language. This does not include non-US companies like Alibaba and measures “value created” rather than strictly liquid cash. Many of the major technology developments happened in companies that were already public (the iPhone, the debut of Android, the launch of YouTube and Instagram), so they weren’t reflected in the IPO numbers.
Anyway…it’s been a really eventful 25 years. Among others, this period saw IPOs by Google (2004), Tesla (2010), and Meta (2012), which are now among the most valuable companies in the world. During the same period, LinkedIn, Slack, and WhatsApp were all acquired for more than $20 billion. Uber’s $84 billion IPO seemed like a lot of money in 2019, but it’s less than 5% of what SpaceX made.
One of the factors here is that companies are staying private for longer periods of time. Google today would probably have delayed its IPO and gone public with a much higher number. Another factor is the capital-intensive nature of AI training, which forces research institutions to seek intense funding and inflate valuations. But the size of the initial public offering remains far greater than anything the industry has done before, and is already pushing financial infrastructure to its limits.
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