The market for M&As and IPOs is strongly up, which is good for Silicon Valley venture capitalists, who can use those transactions to make money off their investments. That’s all good, because it helps fuel optimism, and means more money for promising entrepreneurs down the road. Here’s a table that shows how 2004 was the strongest year since 2000.
On the other hand, we’re noticing an increasing number of Silicon Valley companies filing to go public even as their losses seem to be growing. There’s Emeryville Intarcia Therapeutics, a biotech company, which filed to go public even though it shows a $22.6 million net loss during the nine month period ending in September 2004, widening from $10.9 million in 2003. (Yikes: Since 1997, the company has raised more than $143 million in venture capital.) There’s Milpitas’ Rackable Systems, which sells server and storage systems, filing to go public even as it has a $41.1 million loss during the nine month period ended Sept. 30, up from $40.9 million in 2003. And then there’s Santa Clara’s XenoPort, a biopharmaceutical company, that has filed to go public while reporting a net loss of $22.15 million for the nine months, growing from a net loss of $17.29 million in the comparable period. (XenoPort has raised over $150 million in venture funding.)
Guess these biotech companies had better hurry up — the window of opportunity might be closing — or maybe that’s the reason they’re rushing out?