Why is IPO so expensive for most companies?
During its June stock market debut, SpaceX raised 86 billion dollars in capital, and its company value was estimated at over 2000 billion dollars. However, the results of August 4 showed a significant decline in market value. The SpaceX IPO was only the first step, as other companies, such as OpenAI, Anthropic, Stripe, and Databricks, are also planning their own public offerings this year. Wall Street is focusing on their size, but the issue of returns remains open for investors.
SpaceX’s June stock market debut raised $8.6 billion, and the rocket manufacturer’s value was valued at over $200 billion. By August 4th, when the company announced better-than-expected results, its market value had already fallen by hundreds of billions of dollars. However, SpaceX’s stock market debut was just the beginning. This year, several other companies may also conduct their initial public offerings (IPOs), and their market valuations could be staggering. These include OpenAI and Anthropic, two artificial intelligence laboratories, Stripe, a payment services provider, and Databricks, a data software company. Their sheer size has drawn the attention of Wall Street. The question remains whether they will also attract investors.
