Our latest analyst note explores why companies valued at more than $5 billion might pick a direct listing over a SPAC merger, and why a wider range of businesses could pursue this alternative path to the public markets. Among the takeaways:
Note: This report was updated on March 12, 2021.
- A direct listing, combined with a large private fundraising round, can allow large unicorns to select the specific pricing and investors they want.
- This approach can be especially attractive for companies that have above-market revenue growth or operate in a popular industry, which can drive significant investor demand.
- Regulatory changes may help level the playing field between traditional IPOs and direct listings.