Scott Kirsner, the Boston Globe’s innovation columnist, on Sunday thoughtfully tackled the question of when the current IPO drought is likely to end. His piece, which makes a nice mention of CBT Advisors, is nominally focused on the Boston area but the sentiments are of course similar in other geographies. Here is an excerpt with a link to the rest of the piece below.
IPOs in a holding pattern
Start-ups are ready, when the market is right
By Scott Kirsner Globe Columnist / June 13, 2010
Filing the paperwork for an initial public offering is like buying the perfect bathing suit for a beach party. Yes, you’ve taken the first step by finding something to wear, but you still need people to show up at the party and warm weather, too.
Right now, the forecast isn’t phenomenal for the five Massachusetts companies looking forward to their day in the sun.
“There were some dumb people last year saying that 2010 was going to be a good year for IPOs — and I was among them,’’ said Peter Falvey, cofounder of Revolution Partners, a Boston-based investment bank. “As we’ve seen, the markets have been really unsettled, and when that happens, IPOs are the first thing that shuts down.’’
One of the most recent local offerings, Aveo Pharmaceuticals Inc., a Cambridge biotech working on a drug for kidney cancer, had hoped to sell its shares for between $13 and $15; the shares debuted at $9 in March and have declined since to about $7.50.
Despite the market conditions, a quintet of companies is lined up for their turn, representing diverse sectors of Massachusetts’ innovation economy: energy, consumer-focused services, life sciences, and technology.
■ Newton’s First Wind Holdings Inc. develops and runs six wind farms in states including Maine and Vermont, and has plans to build others; the company originally filed to go public in the summer of 2008, and it hopes to raise as much as $450 million, using the clever ticker symbol WNDY.
■ Zipcar Inc., based in Cambridge, operates the world’s largest car-sharing service, with more than 400,000 members who pay for convenient access to a fleet of 7,000 vehicles.
■ BG Medicine Inc. is a Waltham company developing blood tests for heart disease and multiple sclerosis.
■ GlassHouse Technologies Inc. of Framingham is a consultancy that helps its clients manage corporate data centers.
■ Ameresco Inc., also based in Framingham, helps customers manage their energy usage.
Of BG Medicine, Steve Dickman of the consulting firm CBT Advisors notes that the company’s tests haven’t yet won approval to be sold in the United States or Canada. “It’s a very promising technology platform, but it’s wishful thinking that they will be able to go public without significant revenue,’’ he wrote in an e-mail.
And Ethan Zindler, an analyst at Bloomberg New Energy Finance, said First Wind may also have a tough time.
You can read the rest of Scott’s article here.