2021 was a strong year for Initial Public Offering (IPO) and Special Purpose Acquisition Companies (SPAC). In total, more than 1,700 companies went public in 2021, raising more than $300 billion. Some of the best-known names that went public in 2021 were Affirm, WeWork, Rivian Motors, Lucid, NerdWallet, and OpenDoor.
Still, while many companies went public in 2021, their performance in the market has lagged. Data compiled by Dealogic showed that more than half of companies that went public in 2021 were trading below their listing price. Some of the stocks that have crashed after going public include Robinhood Markets, Coinbase, Oatly, and WeWork.
Similarly, while Rivian stock soared after its public offering, it has now crashed and is approaching its all-time low. So, here are some of the top IPOs to watch in 2022. The list will also include companies that will go public through other methods like direct listing and SPACs.
Trump Media & Technology Group (TMTG)
In 2021, Donald Trump was banned from all leading social media platforms like Twitter and Facebook. These companies accused him of inciting the insurrection that happened on January 6th. In the third quarter of the year, Trump announced that he was launching a new media and technology company known as Trump Media & Technology Group.
TMTG will go public possibly in 2022 by merging with a SPAC known as Digital World Acquisition (DWAC). The company will have three key divisions. It will have a social media platform known as Truth Social. This is a platform that looks similar to Twitter. Trump hopes that his influence will make the platform more popular among conservatives.
The company will also launch TMTG+, a video subscription company, and TMTG News, a platform that will provide news. In other words, Trump wants to disrupt the social media, video streaming, and news industry.
The DWAC stock price has jumped sharply after the merger with TMTG was announced. This values the SPAC at about $1.5 billion. According to Forbes, TMTG is valued at more than $10 billion or about a third of Twitter.
Therefore, the merger of TMTG and DWAC will be watched closely in 2022. Investors will be following the growth of the company’s social media platform and the revenue it will bring.
Discord
Discord is a social media platform that provides video, text, and voice communication. Its main product looks like WhatsApp, but it puts more emphasis on groups. For example, you can belong in groups like a neighborhood, gaming, art, investing, and even cryptocurrencies. All communication in Discord is encrypted, improving its privacy.
In 2021, Discord became a popular platform among day traders. As a result, it was intended to be bought out by Microsoft, which offered about $12 billion. The two companies ended these negotiations since they wanted a bigger valuation.
Discord has raised more than $982 million from investors, valuing the firm at more than $15 billion. This is a notable achievement since the company was valued at about $7 billion in its capital raising in 2020. Analysts believe that the firm will go public in 2022.
Stripe
Stripe is one of the highest-profile fintech companies in the world. It provides a number of services to companies globally.
Its primary product is that it processes funds for companies and takes a small commission for every transaction that passes through its network. One of the top companies that use Stripe’s services is Uber. Deliveroo, Peloton, Hims & Hers, and Asos.
The company has also expanded its solutions through acquisitions. For example, it acquired Bouncer, a company that helps firms avoid online fraud. It also acquired PayStack, a Nigerian company that provides payment solutions to many companies in Africa.
Stripe has raised more than $2.2 billion from venture capital firms. The latest round valued the company at almost $100 billion. This makes it one of the biggest financial technology companies in the world. Therefore, if it decides to go public in 2022, it will be the biggest firm to do so.
Chime Bank
NuBank, a Brazilian neobank company that is backed by Warren Buffett, is expected to go public in December this year. This will be one of the biggest IPOs since it will value the firm at about $42 billion.
Depending on how the company performs as a public firm, it could put more pressure on more neobanks to go public. One of these companies that could go public in 2022 will be Chime Bank, a leading American neobank that has over 1.43 million customers.
The company offers digital banking solutions at a relatively low cost. For example, unlike most big banks, the firm does not charge any overdraft charges. It has also expanded its solutions to include insurance and money transfer.
Over the years, Chime has raised about $2.2 billion from investors. Its most recent funding round valued the firm at more than $14 billion. This makes it one of the top IPOs to watch in 2022.
Klarna
The buy now, pay later industry took off during the pandemic. This is an industry that allows people to buy today and then pay in equal installments. Most of these companies don’t charge interest, making it more affordable than credit cards.
In 2021, Affirm, an American BNPL company, went public and is now valued at more than $26 billion. In the same year, PayPal acquired Paidy, a Japanese BNPL company. And Square announced that it would acquire AfterPay.
These trends could push Klarna, the giant Swedish BNPL company, to go public in 2022. The company has raised more than $3.7 billion at a valuation of more than $45 billion. Therefore, the firm will likely go public in 2022.
Other companies to watch
There will be other key companies that will go public in 2022. Some of these companies are FlipKart, AirTable, Trustly, and Brex.
