IPO Landscape: Surging SPACs and a Pandemic Boom Ahead

2020 Milestones and 2021 Outlook

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Last year’s blazing pace of technology and life sciences IPOs, direct listings and special purpose acquisition companies (SPACs) has shown no signs of slowing in 2021. Following the second half of 2020, the most active six months for the space since we began tracking it in 2012, the market appears poised for a post-pandemic boom that could rival or exceed last year’s.

New in this edition of Fenwick’s IPO report is our survey of 366 executives and investors in the technology and life sciences sectors, conducted in January 2021. The survey gauged these key players’ perspectives on SPACs, lock-up provisions and other dynamics likely to play prominent roles in shaping this year’s IPO landscape.

Our top-line findings include:

  • A SPAC bubble. The majority of respondents said we are in a SPAC bubble but most of the tech and life sciences executives and investors expect the surge to continue.
  • Lock-ups will begin to fade in the coming years. And respondents believe companies seeking to avoid lock-ups will increasingly gravitate toward direct listings in the meantime.
  • Dual-class capital structures are here to stay, in tech. But the majority of technology investors and executives believe dual-class IPOs will increasingly include mandatory sunset clauses, amid growing pressure from institutional investors and governance advocates.

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