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New York Stock Exchange
Photo: Courtney Crow / AP
The youngest stock market star has turned his back on Silicon Valley with a sniff.
Shortly before its debut on the stock market this week, the software company
Palantir
relocated
its headquarters from Palo Alto 2,000 kilometers east to Denver, Colorado.
In the stock market prospectus, company boss Alexander Karp makes no secret of his aversion to the government-critical culture of the tech mecca: "Our company was founded in Silicon Valley," writes the 52-year-old entrepreneur, who is doing his doctorate in philosophy at Goethe University in Frankfurt am Main hat: "But we seem to be sharing fewer and fewer values and beliefs with the technology sector."
For many civil rights groups, the data analysis firm, which was co-founded by billionaire Peter Thiel, is a red rag.
The start-up has received money from the CIA, and its major clients include the US Department of Homeland Security and the notorious ICE immigration police.
The construction of software platforms "that enable the state to monitor its opponents more effectively or help soldiers carry out attacks" raises difficult ethical questions, Karp himself admits in his letter to the investor community.
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Palantir boss Karp
Photo: Thibault Camus / AP
However, investors seem to see potential in the business model.
Instead of a classic IPO, Palantir has chosen the direct placement, in which no new shares are issued, but the existing owners resell shares to the public.
Palantir began its first day of trading with a price jump of around 30 percent and a valuation of more than $ 20 billion - even though the company has not yet made a profit in its 17 years.
In the prospectus it warns "that we may not be profitable in the future".
Palantir is just one of two so-called unicorns, startups with goodwill of more than $ 1 billion that galloped on the New York Stock Exchange this week.
The software manufacturer
Asana also
began the new chapter in its company history on Wednesday well above the reference price.
Investors' appetite for fresh shares currently seems insatiable - not despite, but because of the corona pandemic.
The flood of money from the central banks fueled the search for high-yield investments, said Susannah Streeter of financial services provider Hargreaves Lansdown to CNN, and there were no other investment options.
"It's almost as if people don't know what else to do with their money."
2020 could therefore be a record year in terms of IPOs.
In the third quarter alone, according to the investment bank Renaissance Capital, 81 companies started the capital market and raised almost 29 billion dollars.
The software
specialist Snowflake launched
the largest ever IPO of a software company in mid-September.
Even the start-up averse major investor Warren Buffett couldn't resist.
His company Berkshire Hathaway invested $ 735 million in Snowflake - and by the evening of the first day of trading was almost a billion dollars richer.
The rapid price gains are currently more the rule than the exception.
On average, prices shot up by 39 percent on the first day of trading.
It's not just tech companies who use the opportunity to raise funds.
Many companies from the health sector are also there - such as the Tübingen-based Covid vaccine developer
CureVac
in August.
The stock market candidates are "eager to benefit from the enthusiasm," says industry specialist Renaissance Capital.
The season's fashion trends include not only direct placements like that of Palantir, but also so-called SPACs (
special-purpose acquisition companies
) - more appropriate: blank check companies.
So companies that have nothing to sell.
Your business model is to raise money for acquisitions.
A record 75 SPACs went public in the third quarter.
"It's almost as if people don't know what else to do with their money"
The hedge fund manager Bill Ackman will go on the hunt for "mature unicorns" with his four billion dollar SPAC Pershing Square Tontine.
Former Republican top politician Paul Ryan and Donald Trump's ex-economic advisor Gary Cohn have also jumped on the SPAC bandwagon.
The market for IPOs, which not long ago was considered futile, is lucrative again.
So lucrative that the first ones are reminded of the dot-com bubble at the turn of the millennium, which burst with a big bang.
"It feels like 1999," says Mike Novogratz, head of the financial services company Galaxy Digital Holdings.
"There are a number of signs that we are in a partly speculative mania," he warned on CNN.
For the time being, however, the game is running undisturbed.
The next housing
broker
Airbnb
and food
supplier Doordash
are in the IPO starting
blocks
.
Unlike Palantir, however, they have no plans to leave California's start-up scene behind with the new phase of their lives.
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