The FOUR most anticipated IPOs to watch in H1 2022

By Maxim Manturov
Maxim Manturov, Head of Investment Research at Freedom Finance Europe, shares his forecast on the hottest initial public offerings of the year

A record number of initial public offerings (IPOs) are expected to hit the market in 2022. Following an important year of growth and recovery, many organisations are approaching investors to raise funds and take their expansion efforts to the next level.

This IPO craze is said to have been fuelled by two key factors. One is the growing appetite amongst retail investors to participate in active IPOs. As rates sank to some record lows in March and April 2020, a new breed of thrill-seeking investors plowed into the global stock market on the hunt for high-growth opportunities.

And two, taking your business public will enhance its reputation – helping to raise capital for future growth. It, therefore, comes as no surprise that despite the uncertainties caused by Covid-19, global IPO volumes are expected to rise by 67% year on year.

In light of this, let’s take a look at some of the most exciting IPOs expected to hit the market in H1 2022. These include companies such as Stripe, Instacart, Databricks, and Discord, all of which offer a unique product offering that is high in demand.

Stripe

Stripe is a digital payment platform for internet businesses. The platform lets you accept credit cards, debit cards, and mobile wallets around the world, and is currently being used in 120 different countries.

In December 2021, Stripe announced the launch of Stripe Treasury – a service that offers users APIs to embed financial services, allowing their customers to easily send, receive, and store funds. Stripe is therefore moving from a payment platform to a ‘banking-as-a-service’ (Baas) platform, which is already trusted by its existing users.

The company was last valued at $95bn and, given its recent performance, is likely to have hit $100bn by the end of 2021. For those looking to invest in some of this year’s most exciting IPOs, Stripe is most definitely one to watch as it continues to strengthen its position as a key player in the online payments space.

Instacart

Instacart is one of the most popular grocery delivery and pick-up services in the US and Canada. The company has built a complex logistics system that includes agreements with more than 400 retailers covering more than 30,000 stores.

The network is available to around 85% of households in the US and 80% in Canada and can be accessed via a website and mobile app. It is also important to note that customers can get fresh food delivered directly to their door in less than two hours.

Instacart was last valued at $39bn and at IPO could be valued at $50 billion. Many expect its flotation to take place in early 2022.

Databricks

Databricks is a data and AI startup that has developed software to quickly process big data and prepare it for analysis. The company has a client base of over 5000 customers, including high-profile clients such as CVS Health, Comcast, Condé Nast, and Nationwide.

The startup raised $1bn in its latest funding round in early February 2021 and is currently valued at $28bn. Databricks investors include Fidelity Management and Research, Whale Rock Capital Management, Amazon, Salesforce Ventures, Andreessen Horowitz, Capital G (Google), and Microsoft.

According to recent data, the company could be valued between $35 and $50bn as its IPO launches. Investors must therefore ensure to keep the AI-driven giant on their radars.

Discord

Discord is a free text, audio, and video-chatting platform. Users communicate with one another through voice calls, video calls, and text messaging, as well as sending media and files through private chats.

As to be expected, the gamer-oriented app became extremely popular during the height of the pandemic, with thousands of users accessing the platform to communicate with friends and family whilst in lockdown.

In 2021, Microsoft wanted to buy the company for $10 billion, but Discord management rejected the deal. An official date for the Discord IPO is yet to be announced, but it is expected early this year.


About the author: Maxim Manturov is Head of Investment Research at Freedom Finance Europe, a Cyprus-registered broker with experience and expertise in the US stock market, that provides domestic and international clients access to Russian, American, and Kazakh stock exchanges.


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