Very few days ago, Coinbase Announces Planning to Go Public, was announced by the company through a post on its blog.
The company, founded in 2012, allows users to buy and trade decentralized tokens like bitcoin and ethereum. Since it was founded, it has raised more than $ 540 million, a figure to consider. While we must be cautious when trying to enter the world of cryptocurrencies, many people are taking the leap, especially after 2020.
Coinbase goes public through direct listing
The company’s finances remain to be seen. However, it is now known that they chose to exit the traditional IPO process. Over time direct listings have become increasingly popular and Coinbase plans to go public.
On top of that, considering how the latest technology IPOs are working, it is not at all surprising that companies like Coinbase choose this path to target public markets.
It is not the only company that opts for a direct listing. For that matter, the company behind Roblox delayed its own offering after seeing how the IPO market was developing in late 2020.
What are direct listings?
Direct listings allow companies to bypass any element of the traditional initial public offering, thus eliminating the need to price and sell a new block of capital. The noticeable difference is that the company simply has to list its shares, which will be available for trading.
Obviously, not all companies have a profile that is attractive enough to be able to carry out this operation. Furthermore, we must bear in mind that once it occurs, it loses the ability to obtain new primary capital. In the case of the best-known companies, they can have much more attractive and convenient direct listings.
The past few months have been remarkably positive for tech IPOs, with lots of investors vying to back tech companies. In this way and taking into account how the cryptocurrency market is growing, Coinbase is possibly starting on the right foot.
Ironically, the same day that Coinbase announces that it will be made public through a direct listing. The software company Qualtrics, goes public. This company recovered its shares by almost 50%.
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