It is appealing for a company to go public. You may make it big with the next Amazon or Tesla if you buy the proper stock as soon as it launches and hangs on to the shares.
These prospective initial public offerings (IPOs) could potentially offer similarly high amounts of gain in sometime. However, there is one major issue: For every successful IPO, there are innumerable new public firms that end up losing a lot of the shareholders’ money. Around half of the newly public firms had negative returns after five years in the recent years.
According to a study by Ernst & Young, a total of 2,388 companies raised around $453 billion by going public in the year 2021, the largest annual deal volume ever recorded. Deal volume in the United States of America also set new highs, with as many as 1,100 private firms going public and raising some serious cash – around $260 billion. Coinbase, a highly popular online cryptocurrency exchange, and Rivian, a Tesla competitor company, were among the companies that captivated investors’ interest and powered a record-breaking surge of initial public offerings (IPOs) and direct listings.
Despite the rising risks, Stanfill observes that a substantial number of special-purpose acquisition companies are still actively looking for mergers and are anticipated to generate a significant IPO tailwind. Private companies that have been listed on a U.S. exchange have generated about $155 billion through almost 575 SPACs, surpassing last year’s record 606 SPACs that went public. (Forbes Media said in August that it will go public this year through a SPAC). Even though the Securities and Exchange Commission (SEC) is threatening to impose some stricter disclosure requirements for these time-saving, go-to-public vehicles, the sheer volume of available funds and interest — and the potential for SPAC sponsor returns—most companies have no more than 2 years to negotiate an IPO debut, so they will likely keep the IPO market afloat.
The Environmental-Tech or the Eco-Tech sector is another blooming sector, with most of the developed and developing world rallying towards greener alternatives and options. Thus, to fill in the picture, several eco-tech companies have popped up to meet the demand of the transition.
The IPO market is gearing up for another record-breaking year, and Eco-Tech companies are sure to make a buck in this year. Here are the firms to keep an eye on as they might prepare to go public in 2022.
Aurora Solar creates solutions that enable energy experts to manage their processes and offer better results to their clients by combining cloud computing technology with energy conservation. Its one-of-a-kind software platform unifies all components of the solar panel commissioning process, allowing engineers to manage financing, modeling, sales, and permit compliance from a single place.
Heliogen’s major goal is to create solar energy systems that are powerful enough to eliminate the need for fossil fuels. Heliogen’s solar power solutions, which have been covered by CNN, NPR, and Forbes, use AI to arrange its panels in the most optimal locations to maximize the amount of energy they can create. Regardless of profitability or value proposition, this is a company to watch thanks to a good team, experienced investors, and a compelling story.
The team at WeaveGrid, situated in Silicon Valley, creates infrastructure software to facilitate the rollout of electric vehicles. The company’s use of cloud-native technologies aids in the development of electric grid systems that make the transition from traditional to electric travel easier.
Encamp provides a single platform for managing risk, reviewing rules, and completing paperwork to help businesses stay green and manage their environmental compliance. Its platform provides companies with access to both local and federal environmental standards, allowing them to be compliant at all times, as well as automated agency reporting, which eliminates time-consuming duties.
Enervee is an online application that shows users the energy efficiency ratings of household appliances, allowing them to make more informed decisions about their energy consumption. Enervee, which bills itself as the world’s first energy-smart e-commerce platform, collects scores on devices and appliances from all over the internet, and its web tool offers clients sustainability-focused recommendations on their purchases.