In many ways, tech IPOs have become the real unicorns: beasts that are mythical and thus never actually seen.
Put another way, it is the opposite of the way the term is used now to label any private, venture-backed company with a valuation north of $1 billion. Basically, that is pretty much every single tech company at this point, which means this type of unicorn is easier to spot than plastic cups on the floor of a fraternity house after an all-night kegger.
Despite the fact that the tech IPO has been all but vaporized, there is some reason to think that it has not been completely snuffed out. Just this week, Renaissance Capital noted there were four tech IPOs in the second quarter, up from zippo in the first quarter.
And with the Line IPO chugging down the tracks, the third quarter will at least get off to a not completely moribund start.
But whither from here? Renaissance Capital keeps a watch on “Notable Private Companies Expected to Seek IPOs.” So I thought it would be interesting to take a look at these tech prospects, although, personally, I’m way more psyched that one of the non-tech candidates is Jose Cuervo, the “world’s largest Tequila producer.”
- Spotify: Well, duh. With the company recently hiring a director of investor relations and raising debt tied to an IPO, this is taking on the air of inevitability. The only question at the moment seems to be whether its current spat with Apple over the App Store could derail or delay such a public offering significantly.
- Blue Apron: Now technically, Renaissance classifies this company as a “consumer” rather than “technology” play. But since it uses the internet, and it raised $135 million last summer at a $2 billion valuation, we’re putting it in the tech column (which could use some juicing, anyway.) Investors include First Round Capital, Bessemer Venture Partners, and Fidelity. It’s been a hot name, but there’s a question of whether there’s enough interest in people buying meal kits to justify that sky-high valuation. Especially when there are endless prepared meal delivery services. And that could make it tricky to get a public valuation that matches the private one.
- Optiv Security: This Denver-based cybersecurity company is the product of two other Blackstone-backed security firms that merged last year. Optiv recently completed another acquisition and reportedly hired Goldman Sachs to explore an IPO. But there are also reports that the company is open to an acquisition.
- Domo: This company re-emerged from stealth earlier this year with a splash. The Utah-based business intelligence startup announced that it had raised $130 million at a $2 billion valuation. It has now raised a total of $590 million. The company hit an annual revenue run rate of $100 million in 2015. So it has momentum, but we’ll see if it’s in a hurry to capitalize on that in the public markets.
- AppDynamics: Earlier this year, the CEO begged us not to call his company with a $2 billion valuation a unicorn. And more recently, we wondered whether the door had slammed shut on this company’s IPO prospects in the short-term. But it’s still on the Renaissance list, so we’ll eave it here for now and revisit.
- Okta: Same as above: We had this enterprise software company on a door-slammed-shut list. Renaissance did not. So, we’ll check back in next quarter. But they’re backed by the usual list of Silicon Valley nobodies: Andreessen Horowitz, Greylock Partners, Khosla Ventures, and Sequoia Partners. So it seems like a bad idea to count them out.
- Talend: This company has already filed to go public, so this might seem like shooting IPO fish in an investment banking barrel. We previously described them as “a startup with data integration software that simplifies the process of aggregating multiple data sets for later analysis.” Investors include Bpifrance, Iris Capital, Silver Lake Sumeru, Balderton Capital, and Idinvest Partners. Still, the world is a wacky place, and there are plenty of companies that withdraw after filing. That said, chances are high on the IPO-o-meter.
- LogRhythm: Founded in 2003, this security company has been around since humans were still learning to make fire. Or using MySpace. But over the years, it’s raised more than $76 million in VC backing. And after 13 years, it wouldn’t be surprising if folks are eager for an exit of some kind.
- Aquantia: Launched in 2004, this semiconductor firm most recently raised $16 million in 2014, for a total of $140 million. Investors include Greylock Partners, Lightspeed Venture Partners, Pinnacle Ventures, and Venture Tech Alliance. As with the previous entry, I’m sure these investors would love to slip this puck past the public market goalie.
- Quantenna: This company says its chips will make Wi-Fi six times faster. In which case, we could not personally give it enough of our savings fast enough to make this happen. Quantenna, founded in 2006, has raised $159 million. Investors include Sequoia Capital, Venrock, Sigma Partners, Southern Cross Venture Partners, DAG Ventures, Rusnano, Swisscom Ventures, Grazia Equity, and Telefónica Digital.
- China Music: In May, the Wall Street Journal reported that this Tencent-backed streaming service was headed toward IPO glory. The Chinese economy is stumbling a bit and may not be the world’s strongest selling point for investors. But, on the other hand, they may be eager to get any piece of Tencent. So, we decline to bet against it at the moment.
- Carbon Black: Once upon a time, this company was called Bit9. It acquired a company called Carbon Black and raised $38 million in venture capital in 2014. Now, it has apparently changed its name to Carbon Black, which we think is cooler anyway and gives the company just a hint of a sci-fi post apocalyptic flavor. Investors include Kleiner Perkins, Sequoia Partners, Highland Capital, and .406 Ventures.