Whats behind the boom in IPOs?
Theres been a boom in initial public offerings this year. New data from the research company Dealogic finds that the amount of money raised through IPOs this year, more than $173 billion, has already surpassed all of the money raised through IPOs in 2020, and its only June. When you look at the type of companies that have gone public this year, a lot of them are in sectors that have done well during the pandemic, like companies that deal with remote learning, gaming, digital payments and e-commerce and all that stuff, said Santosh Rao, head of research at Manhattan Venture Partners. Its also just been a good time for stocks in general. Kathleen Smith, a founder of Renaissance Capital, which tracks IPOs, said the markets been pushed up in large part by low interest rates. Thats made investors more eager to plow money into these newly listed companies because it means returns for investors, Smith said. Thats the fuel that drives the IPO issuance engine.  The only fear, according to Smith, is whether inflation and higher interest rates could slow down the stock market and scare off investors. Because theyll push back and say, Wait a minute. '  Meanwhile the boom in IPOs is likely to continue. Smith said shes tracking over 130 companies that are waiting to go public.