Neil here.
The highest-profile IPOs of the last year or so are faltering… But I’m not surprised.
Wrapped up in the investor hype and sky-high valuations for many of these companies is one hard truth:
Tech IPOs are just not impressive. And many times, that’s putting it lightly. If you’re looking to strike serious gold, investing in a high-profile public offering is often not the way to go.
I wanted to talk about this today because we’re officially a few months removed from the public debuts of companies like Airbnb, DoorDash, Snowflake, and more… companies that ignited a type of IPO-day media attention we’ve rarely seen before.
That attention came for good reason. These companies made up the biggest IPOs of 2020, and since then, we’ve seen plenty of other tech superstars go public as well.
At the end of the day, however, it wasn’t these companies’ IPO-day investors who made bank… not by a long shot. Let’s take a look at the numbers. As I write this…
These three companies aren’t isolated cases. This type of post-IPO-day slump is, in fact, normal across the tech IPO board.
But while IPO-day investors are licking their proverbial wounds and tending to their losses, early-stage angel investors are popping champagne left and right.
Let’s do the math on Airbnb, for example. The company started small in 2008, with only a $1.5 million valuation. By 2017, that valuation had skyrocketed to $31 billion… a mind-blowing 2,066,567% increase.
Even at the beginning of COVID-19, when the company’s valuation nearly halved to $18 billion, that was still a 1,199,900% jump. The company then rebounded and went public at a $47 billion valuation last December.
Airbnb’s earliest investors? Yeah, I’d say they were pretty pleased on IPO day.
That’s the beauty of angel investing. If you score big on just one angel investment, your net worth could absolutely explode.
All it takes is getting in on the right company long before it ever hits the public market, and watching their idea come to life while waiting for your angel investment to mature. Even if that company goes public and slumps, you’ll have the chance to exit and cash out while the rest of the world floods in.
And if you play your cards right, you can even get in on the kinds of companies that really only come around once in a generation. Imagine the return potential from an early-stage investment in a deal like that!
One of the companies on my radar, for example, is developing a piece of technology with a caliber I’ve only seen from a couple of other startups in my entire life.
Even better, this startup has opened its current funding round to everyone, meaning you can get in regardless of your income or net worth. Normally, companies like this require you to have at least $1 million in liquid assets to even be considered for the cap table.
That’s exactly why I want you to get the details today. I’ve been eyeing this company for quite some time now, and you still have the opportunity to claim a stake before it’s too late.
Check out my interview with the founder over here, and I’ll be back next week with another update.
Until next time,
Neil Patel
The highest-profile IPOs of the last year or so are faltering… But I’m not surprised.
Wrapped up in the investor hype and sky-high valuations for many of these companies is one hard truth:
Tech IPOs are just not impressive. And many times, that’s putting it lightly. If you’re looking to strike serious gold, investing in a high-profile public offering is often not the way to go.
I wanted to talk about this today because we’re officially a few months removed from the public debuts of companies like Airbnb, DoorDash, Snowflake, and more… companies that ignited a type of IPO-day media attention we’ve rarely seen before.
That attention came for good reason. These companies made up the biggest IPOs of 2020, and since then, we’ve seen plenty of other tech superstars go public as well.
At the end of the day, however, it wasn’t these companies’ IPO-day investors who made bank… not by a long shot. Let’s take a look at the numbers. As I write this…
- DoorDash, is down around 21% since going public almost six months ago.
- Airbnb dropped 34% from its early-2021 highs to right back around where it started on its own IPO day.
- And Snowflake is down almost 48% since its peak in early December 2020.
These three companies aren’t isolated cases. This type of post-IPO-day slump is, in fact, normal across the tech IPO board.
But while IPO-day investors are licking their proverbial wounds and tending to their losses, early-stage angel investors are popping champagne left and right.
Let’s do the math on Airbnb, for example. The company started small in 2008, with only a $1.5 million valuation. By 2017, that valuation had skyrocketed to $31 billion… a mind-blowing 2,066,567% increase.
Even at the beginning of COVID-19, when the company’s valuation nearly halved to $18 billion, that was still a 1,199,900% jump. The company then rebounded and went public at a $47 billion valuation last December.
Airbnb’s earliest investors? Yeah, I’d say they were pretty pleased on IPO day.
That’s the beauty of angel investing. If you score big on just one angel investment, your net worth could absolutely explode.
All it takes is getting in on the right company long before it ever hits the public market, and watching their idea come to life while waiting for your angel investment to mature. Even if that company goes public and slumps, you’ll have the chance to exit and cash out while the rest of the world floods in.
And if you play your cards right, you can even get in on the kinds of companies that really only come around once in a generation. Imagine the return potential from an early-stage investment in a deal like that!
One of the companies on my radar, for example, is developing a piece of technology with a caliber I’ve only seen from a couple of other startups in my entire life.
Even better, this startup has opened its current funding round to everyone, meaning you can get in regardless of your income or net worth. Normally, companies like this require you to have at least $1 million in liquid assets to even be considered for the cap table.
That’s exactly why I want you to get the details today. I’ve been eyeing this company for quite some time now, and you still have the opportunity to claim a stake before it’s too late.
Check out my interview with the founder over here, and I’ll be back next week with another update.
Until next time,
Neil Patel
Follow @angelsandentrepreneurs
