The IPO Party Rages On

Turmoil in DC notwithstanding, U.S. equity markets hit yet another all-time high last week.

This week, a crowd of high-profile companies are set to make their debuts on Wall Street.

Affirm (AFRM): Buy now, pay later – hopefully the business model isn’t foreshadowing the outcome for investors.

The San Francisco tech company, fronted by Paypal co-founder Max Levchin, allows shoppers to nab items like Peloton bikes with a pay-over-time structure. Affirm was one of the first to enter the pay-over-time space in the U.S. and now partners with over 6,500 online retailers from Adidas to Wal-Mart.

Affirm is set to begin trading Wednesday, expecting to raise nearly $1 billion on a valuation of over $9 billion.

Poshmark (POSH): Debuting Thursday is online fashion marketplace Poshmark. Styled as a digital thrift store, the firm cuts a 20% commission on sales over $15 and boasts over 5 million active sellers peddling 200 million threads, shoes, and accessories. Poshmark fashioned its first profitable year in 2020 and could be valued at nearly 5x its last private valuation round.

Petco (WOOF): You’ve probably heard of Petco, the long-standing pet supply retailer with about 1,470 brick-and-mortar locations.

Today, Petco doesn’t call itself a retailer. Instead, it’s a “category-defining health and wellness company,” for pets (better for valuation, we’re told). CEO Ron Coughlin said in last week’s SEC filing the company is “firing on all cylinders,” touting its revamped online experience and growth in grooming and training services.

The elephant in the room is Petco’s $3.2 billion debt pile. A lot to scoop up.

The Takeaway

A global pandemic didn’t stop 2020 from hosting the most IPOs in two decades. And a thick stack of filings points to another blockbuster year.