We started the month off with one of the most hyped IPOs we’ve seen in awhile. Snapchat, also known as Snap, Inc (NYSE: SNAP), finally went public after very much “will they,” “won’t they” in regards to if it would ever IPO — which was most likely intentional on Snap’s end.

Snap’s secretive plans did do one thing: they brought some much-needed marketing to the company’s market debut.

On its first day of trading the stock jumped 44%, and on the second day it increased 10.7%, closing the day at $27.09.

Snap raised $2.5 billion during its IPO, and shares were trading at $17 per share. It was a decent first day for Snap, especially when shareholders have absolutely no control over the shares they’re purchasing…

But with that said, Snap did exactly what was expected in the next few days after its IPO: it started out strong but quickly plummeted. It rose to its highest price close to its first trading day and hasn’t returned. It got to a low of $19.50 on March 17th — very close to its IPO price.

While it’s still too early to get a grasp on what exactly it has to offer to its shareholders and the public, it did open one obvious door…

The door to future tech IPOs.

So far in March, there were two tech companies that went public: MuleSoft (NYSE: MULE) and Alteryx (NYSE: AYX). We’re also expecting two more promising tech IPOs in April from Okta and Yext.

MuleSoft

MuleSoft was founded in 2006 and is headquartered in San Francisco, CA. It provides integration software for connecting applications, data, and devices to its customers. It’s a flexible and unified platform that allows for applications and systems to securely share data regardless of format or source.  

MuleSoft’s platform has been adopted by many businesses and has created a strong customer base of 1,071 customers (as of 12/31/16). Some of those clients include Coca-Cola Co., Spotify, and Bank of America.  

It went public on March 17th, pricing its 13 million shares at $17 per share. By close of the day, MuleSoft’s share price soared to $24.75, rising 45.6%. MuleSoft’s IPO saw bigger gains on its first day of trading than the much-anticipated Snap IPO. 

MuleSoft IPO Details

• Symbol: MULE
• Exchange: NYSE
• IPO Date: March 17, 2017
• Industry: Technology / Software
• IPO Price: $17
• Shares: 13 million
• Underwriters: Goldman, Sachs & Co / J.P Morgan / B of A Merrill Lynch
• Market Cap: $1889.9 million
• Revenues: $187.7 million
• Net Income: $-49.6 million
• Estimated Volume: $208 million

Alteryx

Alteryx is a leading provider of self-service data analytics software. The company is headquartered in Irvine, California, and has more than 2,300 customers in 50 countries (as of 12/31/16). Some of those customers include Southwest Airlines, Inc., Kaiser Foundation Health Plan, Inc., and Ford Motor Co.

The company conducts business through a subscription-based platform that allows organizations to easily prepare, blend, and analyze data from a multitude of sources and more quickly benefit from data-driven decisions. It’s simple and accommodating. 

It went public on March 24th, offering 9 million shares at $14 per share. At close on the first day of trading, shares were priced at $15.50 — a 10.7% increase.

The company plans to put the proceeds of the IPO towards getting a jump-start on its next business plans for growth, including potential acquisitions. It’s always a great sign when companies plan on using their IPO proceeds towards expanding and growing their business.

Alteryx IPO Details

• Symbol: AYX
• Exchange: NYSE
• IPO Date: 3/24/17
• Industry: Technology / Software
• IPO Price: $14
• Shares: 9 million
• Underwriters: Goldman, Sachs / J.P. Morgan / Citigroup
• Market Cap: $732.2 million
• Revenues: $85.8 million
• Net Income: $-30.7 million
• Estimated Volume: $117 million

There’s no doubt that optimism is brewing within the IPO market, especially when it comes to tech companies, and that’s really great news!

2016 was a lackluster year for IPOs. According to Renaissance Capital, IPOs raised $18.8 billion in 2016, which was dramatically down from 2014’s $86.6 billion. 2016 was a huge letdown, and it left analysts hoping for a better year in 2017… a year where private startups would finally feel comfortable enough to go public. 

I think we’re starting to see that, thanks to recent tech IPOs like Snap, MuleSoft, and Alteryx. And if the market remains optimistic, I think we could see a lot more tech IPOs popping up.

Until next time,

Jennifer Clark
Pro Trader Today