Will the latest dot com bubble burst? That’s the question on many lips, as 2020 shapes up to be one of the most remarkable years ever for tech brands going public.
AirBnB’s listing, which propelled the company’s value 112%, followed big-hitting debuts from DoorDash, Hydrofarm Holdings and software firm C3.ai.
In a difficult economic year—whose real effects will be felt in 2021—the largest tech startups have emerged from the COVID-19 pandemic seemingly unscathed, even as lockdown regulations have hit their core business. AirBnB was the 19th company to double its valuation via an IPO in 2020, the most since 77 did so in 1999, just before everything collapsed.
That characterization may, however, be hasty: the 2000 dot com burst affected companies with little sales cred or revenues. AirBnB and others may still be losing funds. But they have years of operation under their belts. Pets.com these firms definitely ain’t.
In fact the biggest story of the year may be that a whopping 220 companies have gone public with a SPAC (special purpose acquisition company). Perhaps 2020 should be called the Year of the SPAC, rather than being known for the deadly pandemic we’re all still living through.
Some experts are still concerned that armchair investors, using platforms like Robinhood, are inflating the market beyond its economy. And when the vaccine for coronavirus finally brings normality to the world, perhaps tech’s biggest stocks will, slowly, deflate.
But for now, it’s a good time to plough cash into Big Tech stocks. This Christmas, at least, it’s fine to party like it’s 1999.