Unveiling 2023’s Giants: The Biggest IPOs of the Year

<div><img width="1000" height="667" src="https://www.financebrokerage.com/wp-content/uploads/2023/12/shutterstock_1786136444.jpg" class="attachment-post-thumbnail size-post-thumbnail wp-post-image" alt="Unveiling 2023's Giants: The Biggest IPOs of the Year" decoding="async" loading="lazy" /></div><h1><strong>Unveiling 2023’s Giants: The Biggest IPOs of the Year</strong></h1>
<p>The year 2023 has been marked by a comparatively slow pace of initial public offerings (IPOs) compared to 2020 and 2021, when 480 and 1035 IPOs occurred, respectively. In spite of all the challenges, analysts and investors are closely monitoring the situation. They would like to learn more about “biggest IPOs 2023.”</p>
<p>It isn’t hard to understand their position regarding the biggest IPOs of 2023.</p>
<p>Interestingly, there have been 149 IPOs on the US stock market in 2023. As of December 12, 2023, this is more than 14% less than the same time in 2022, which had 175 IPOs by this date.</p>
<p>A shortage of successful IPOs in recent years has caused hesitation among tech companies considering going public due to the volatile market conditions.</p>
<p>However, in September 2023, Arm Holdings, Instacart, and Klaviyo all entered the stock market within a week of each other. Were these IPOs successful, or did they encounter challenges? Let’s delve into their post-IPO performances to find out.</p>
<p>Going public through an IPO can offer substantial benefits for both companies and investors, as it can significantly increase the value of the firm’s shares, as exemplified by Tesla’s CEO, Elon Musk.</p>
<h2><strong>Case of Arm Holdings</strong></h2>
<p><span data-preserver-spaces="true"><img decoding="async" loading="lazy" class="alignnone size-full wp-image-111724" src="https://www.financebrokerage.com/wp-content/uploads/2021/06/shutterstock_1024622245.jpg" alt="China's IPO Market Dominates The World New Records" width="1000" height="667" /></span></p>
<p><span data-preserver-spaces="true">One of the standout IPOs of 2023 was Arm Holdings, a British semiconductor company predominantly owned by Japanese bank SoftBank, which held around 90% of the company. Arm Holdings went public on September 14 with an IPO worth $54.5 billion, making it the largest IPO since truck manufacturer Rivian’s public offering in 2021.</span></p>
<p><span data-preserver-spaces="true">Arm Holdings primarily generates revenue by designing and producing chips and licensing its products to various customers. Notably, a significant portion of its revenue comes from royalties earned through licensing their chips.</span></p>
<p><span data-preserver-spaces="true">However, there are some concerns regarding Arm Holdings:</span></p>
<p><span data-preserver-spaces="true">1. </span><strong><span data-preserver-spaces="true">Valuation</span></strong><span data-preserver-spaces="true">: The IPO was priced at 100 times earnings and 20 times sales, an exclusive club for high-growth companies. In the semiconductor industry, it is priced similarly to Nvidia (one of Arm’s customers).</span></p>
<p><span data-preserver-spaces="true">As a reminder, Arm Holdings’ growth has averaged only 15% over the past three years, with a decline observed in 2022.</span></p>
<p><span data-preserver-spaces="true">2. </span><strong><span data-preserver-spaces="true">Market conditions</span></strong><span data-preserver-spaces="true">: While Arm is a leader in smartphone and PC processors, competitors are rapidly gaining ground, particularly in the smartphone industry, where Arm holds nearly 100% of the market.</span></p>
<p><span data-preserver-spaces="true">3. </span><strong><span data-preserver-spaces="true">China</span></strong><span data-preserver-spaces="true">: Arm faces challenges related to its Chinese subsidiary, Arm China, which contributes 25% of its business. Tensions between China and the United States add uncertainty to the company’s outlook.</span></p>
<p><span data-preserver-spaces="true">Despite its status as one of the “biggest IPOs in 2023,” Arm Holdings faces pessimism due to these concerns, and its stock price may experience volatility.</span></p>
<h2><strong>Instacart </strong></h2>
<p><span data-preserver-spaces="true"><img decoding="async" loading="lazy" class="alignnone size-full wp-image-248258" src="https://www.financebrokerage.com/wp-content/uploads/2023/12/Instacart.jpeg" alt="Instacart " width="1025" height="600" /></span></p>
<p><span data-preserver-spaces="true">Another significant IPO of 2023 was Instacart. While Instacart, a grocery delivery platform, enjoyed immense popularity during the pandemic,. Unsurprisingly, its valuation was almost $40 billion. Currently, the company’s valuation is nowhere near that figure.</span></p>
<p><span data-preserver-spaces="true">Despite this, Instacart’s prospects appear more favorable than those of Arm Holdings.</span></p>
<p><span data-preserver-spaces="true">1. </span><strong><span data-preserver-spaces="true">Market leadership</span></strong><span data-preserver-spaces="true">: Instacart is a market leader in grocery delivery, an industry with ample room for growth as more customers transition to online grocery shopping.</span></p>
<p><span data-preserver-spaces="true">2. </span><strong><span data-preserver-spaces="true">Diversified revenue streams</span></strong><span data-preserver-spaces="true">: Instacart’s revenue sources extend beyond groceries, with the introduction of Instacart Ads contributing 30% to its revenue in 2022.</span></p>
<p><span data-preserver-spaces="true">3. </span><strong><span data-preserver-spaces="true">Steady growth</span></strong><span data-preserver-spaces="true">: Instacart’s revenue has exhibited steady growth, and the company achieved profitability in 2022.</span></p>
<p><span data-preserver-spaces="true">While Instacart experienced some initial volatility in its stock price, market conditions appear more favorable for its long-term prospects compared to Arm Holdings.</span></p>
<h2><strong>Klaviyo </strong></h2>
<p><span data-preserver-spaces="true">We can’t forget about Klaviyo when it comes to “the biggest IPOs in 2023.”</span></p>
<p><span data-preserver-spaces="true">Klaviyo, a global tech company specializing in AI-integrated marketing automation, also went public in 2023 with a valuation of $9.2 billion.</span></p>
<p><span data-preserver-spaces="true">Klaviyo’s revenue has been on the rise, and it aims to expand into new markets, but there is limited information available about its stock market performance.</span></p>
<h2><strong>Birkenstock and its new owners  </strong></h2>
<p><span data-preserver-spaces="true"><img decoding="async" loading="lazy" class="alignnone size-full wp-image-248260" src="https://www.financebrokerage.com/wp-content/uploads/2023/12/shutterstock_2402814289.jpg" alt="Birkenstock and its new owners  " width="1000" height="666" /></span></p>
<p><span data-preserver-spaces="true">Birkenstock made its initial public offering (IPO) debut on October 11th, entering the market at the IPO price of $46 per share, valuing the company at $9.3 billion.</span></p>
<p><span data-preserver-spaces="true">This 250-year-old German shoemaker, previously a family-owned business, underwent a significant ownership change in 2021 when the majority of the company was sold to private equity firm L Catterton, backed by one of the world’s wealthiest individuals, Bernard Arnault.</span></p>
<p><span data-preserver-spaces="true">With the German family no longer involved, Bernard Arnault and his fellow investors have ambitious plans to propel Birkenstock’s growth to new heights.</span></p>
<p><span data-preserver-spaces="true">Notably, the Norwegian sovereign wealth fund, valued at $1.47 trillion, along with Financière Agache and Durable Capital Partners, have all committed substantial investments of approximately $300 million each in Birkenstock’s future expansion.</span></p>
<h2><strong>Neumora Therapeutics and Savers Value Village </strong></h2>
<p><span data-preserver-spaces="true">Neumora Therapeutics has also earned its place among the “biggest IPOs in 2023.”</span></p>
<p><span data-preserver-spaces="true">Moreover Neumora Therapeutics conducted its IPO on September 15 at an IPO price of $17 per share, resulting in a valuation of $2.7 billion. Noteworthy investors in Neumora Therapeutics include SoftBank, Amgen, and Arch Venture Partners.</span></p>
<p><span data-preserver-spaces="true">The history of Savers Value Village dates back to 1954. It is a thrift store chain.</span></p>
<p><span data-preserver-spaces="true">In 2019, with the company approaching bankruptcy, its owners, PE firms Leonard Green and TPG (which had bought it in 2012), sold it to PE firms Ares Management and Crescent Capital with a restructuring agreement.</span></p>
<p><span data-preserver-spaces="true">Savers Value Village went public on June 19, at an IPO price of $18, for a valuation of $2.7 billion.</span></p>
<p><span data-preserver-spaces="true">In summary, Arm Holdings, Instacart, Klaviyo, Savers Value Village, Birkenstock, and Neumora Therapeutics are notable IPOs of 2023, with Arm Holdings standing out as the largest due to its valuation.</span></p>
<p><span data-preserver-spaces="true">However, concerns exist around Arm Holdings, while Instacart appears to have promising growth potential. Only time will tell which of these companies will achieve the most success in the stock market.</span></p>
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