The year 2011 witnessed a few exciting initial public offerings (IPOs). An IPO is when a private company offers its stock to the public market for the first time, transitioning from being privately owned to publicly owned. Going public brings credibility, prestige, attracts investors, customers, and business partners, and provides a way to raise capital for expansion and innovation. The IPO process, however, is expensive, complex, and time-consuming, and public companies face greater scrutiny and regulation. The notable IPOs of 2011 include LinkedIn Corp, Groupon, Zynga, Pandora, Spirit Airlines, GNC Holdings, and CVR Partners.
Initial public offerings (IPOs) are a big deal for the companies that manage to reach such a stage. IPOs constitute a significant step for a company to be able to access funding, helping them to grow their business to the next level.
Every year there are a number of exciting companies that go public with their company shares. Here we’ll explore what IPOs are, the pros and cons, and the most notable IPOs of 2011.
Notable IPOs of 2011
LinkedIn went public on May 19, 2011. They offered under 10% of their total company stock, with an offering of 7.8 million shares, at a cost of $45 per share. The stock price skyrocketed on the day of its IPO on the New York Stock Exchange, closing roughly 110 percent above the opening price.
LinkedIn is a social media website for professionals to connect, find work, and share experiences. LinkedIn was started on May 5, 2003, and nowadays is owned by the tech Mega-giant Microsoft.
Groupon went public on Nov 4th, 2011. They offered 35 million shares at a cost of $20 per share. The stock jumped on IPO day and closed at $26.11 per share. Which helped raise the company $700 million and was the biggest internet startup IPO since Google.
Groupon helps connect consumers with local sellers offering goods, services, as well as travel and activities. Groupon was founded in Chicago in November 2008.
Zynga had an IPO on December 16, 2011, on the NASDAQ. They priced 100 million shares at $10 per share. The company’s lackluster IPO day would close with the stock down 5 percent.
Zynga is an American video game developer. They provide services for the video gaming industry. Some notable Zynga games include FarmVille, Zynga Poker, and Words with Friends 2.
Pandora went public on June 15, 2011. With an offering of 14.7 million shares at a price of $16 per share. The stock had a positive reaction on its first day and closed at $17.42 per share.
Pandora is an online music streaming service that allows users to create personalized radio stations based on their favorite songs, artists, and genres.
Spirit Airlines had its IPO on May 26, 2011. The company priced 15.6 million shares at $12 per share. The company’s IPO day was calm and would close with the stock at the same price it was initially offered for.
Spirit Airlines is a low-cost airline that operates flights to various destinations across the United States, Mexico, the Caribbean, and Central and South America.
GNC Holdings went public on April 1, 2011. They offered 22.5 million shares at a cost of $16 per share. The share price went up slightly on IPO day and closed at $16.25 per share. GNC Holdings raised approximately $360 million on its IPO day.
GNC Holdings is a specialty retailer of health and wellness products, including vitamins, supplements, and sports nutrition products, as well as weight management and beauty products.
CVR Partners had their IPO on April 4, 2013. They offered 20 million shares at a cost of $16 per share. The company’s stock price had a decent IPO day and closed at $16.30 per share.
CVR Partners is a manufacturer and marketer of nitrogen fertilizers, primarily serving agricultural customers in North America.
Fusion-io went public on June 13, 2011. They offered 12.3 million shares at a cost of $19.50 per share. The share price had a positive IPO day and closed at $22.50 per share.
Fusion-io: Fusion-io was a computer hardware and software company that specialized in flash memory technology for data storage and processing. The company was acquired by SanDisk in 2014.
What is an IPO
An IPO is when a private company offers its stock to the public market for the very first time, effectively making the transition from being privately owned to publicly owned. The IPO process is sometimes referred to as “going public” or “stock launch,” and it allows companies to raise capital by selling shares of ownership to investors.
Once a company goes public, its shares are listed and traded on a stock exchange such as the New York Stock Exchange or NASDAQ. This means that anyone can buy and sell shares of the company, potentially making a profit if the company performs well in the stock market.
The Pros and Cons of IPOs
Here is a list of the pros and cons to consider for an IPO.
- Going public brings credibility and prestige to a company’s name
- Being listed on a major stock exchange helps attract new investors, customers, and business partners
- Provides a way to raise more capital for expansion and innovation
- The cost and complexity of the IPO process can be time-consuming and expensive
- Public companies face greater scrutiny and regulation, which can be a burden
- Pressure from shareholders to prioritize short-term profits over long-term growth and innovation
On the plus side, going public can bring a level of credibility and prestige to a company’s name. By being listed on a major stock exchange, it can help attract new investors, customers, and business partners, as well as provide a way to raise more capital for expansion and innovation.
A major downside of IPOs is the cost and complexity of the IPO process itself, which can be both time-consuming and expensive. Public companies also face greater scrutiny and regulation, as they are required to disclose financial information and meet reporting requirements to shareholders and regulatory bodies. Additionally, public companies may experience pressure from shareholders to prioritize short-term profits over long-term growth and innovation.
What happened to the stock market in 2011?
In 2011, the stock market experienced a number of ups and downs due to a variety of factors, including ongoing concerns about the European debt crisis and the slow pace of economic recovery in the United States. Despite these challenges, the stock market managed to finish the year on a positive note, with the S&P 500 index ending the year up 13.4% from its 2010 close.
What is the largest IPO in history?
The largest IPO (initial public offering) in history was the IPO of Saudi Arabian oil company, Saudi Aramco, which was launched in December 2019. The company raised $29.4 billion by selling 1.5% of its shares on the Saudi stock exchange, the Tadawul. The IPO surpassed the previous record held by Chinese e-commerce giant Alibaba, which raised $25 billion in its IPO in 2014.
How many companies went public in 2011?
In 2011, a total of 171 companies had their initial public offering (IPO) in the United States.
- IPOs are a significant step for a company to access funding, helping them to grow their business to the next level.
- Notable IPOs of 2011 included LinkedIn, Groupon, Zynga, Pandora, Spirit Airlines, GNC Holdings, CVR Partners, and Fusion-io.
- An IPO is when a private company offers its stock to the public market for the very first time, effectively making the transition from being privately owned to publicly owned.
- The pros of going public include increased credibility, access to new investors, customers, and business partners, and the ability to raise more capital for expansion and innovation.
- The cons of going public include the cost and complexity of the IPO process, greater scrutiny and regulation, and pressure from shareholders to prioritize short-term profits over long-term growth and innovation.
View Article Sources
- Rebuilding the IPO On-Ramp — SEC
- IPOs — Nasdaq
- Companies That Had Their IPO In 2017 — SuperMoney
- Companies that had their IPO in 2015 — SuperMoney
- Companies That Had Their IPO in 2002 — SuperMoney
- Companies that had their IPO in 2018 — SuperMoney
Allan Du is a personal finance writer passionate about helping people take control of their finances. Allan strives to present readers with the right knowledge and tools, so they can make informed decisions about their money and build wealth. When he is not writing about finance, Allan enjoys pursuing his other interests, including powerlifting, kickboxing, and investing. He is an active follower of economic and political trends, always keeping watch on the latest developments that could impact the financial world.