03/01/2004
The rebound of the initial public offerings (IPO) market in late 2003 provided welcome respite for venture capital and private equity investors who had been seeking liquidity. The fourth quarter saw 17 venture-backed companies raising $1.05 billion. It was the highest number of IPOs for venture-backed companies since the fourth quarter of 2000, when 21 companies went public, according to Thomson Venture Economics and the National Venture Capital Association.
The strong finish capped what had been a weak year; only 12 venture-backed companies went public in the first three quarters. The 29 venture-backed IPOs in 2003 raised $2.02 billion.
Although this was more than the 24 that limped to market in 2002, those actually raised more money—$2.47 billion.
Encouragingly for this year’s market, 24 of the newly public venture capital-backed companies finished the year trading at or above their offering prices.
Tessara Technologies was the largest venture-backed IPO of the fourth quarter 2003; it raised $97.5 million. Five of the 17 IPOs, representing $295.8 million, were in the medical/health industry. By the end of 2003, 31 venture-backed companies had filed to go public this year.