Poshmark and Petco's shares had a significant first-day pop, following Affirm, which had a 98% share price increase on its first day of trading. Poshmark's shares are up 123% and Petco's shares are up 60% since their debut on Thursday.
- The increase in Petco's share price reflects investors' interest due to the growth in spending on pet products. Around $95B was spent in the U.S. on pet products in 2019, and e-commerce sales of pet products are expected to grow from $10B last year to $15.5B in 2025.
- Poshmark provides an online marketplace for second-hand goods. The company generates revenue by taking a revenue share from the items sold through the marketplace: 20% for items above $15 and $2.95 for items below.
- Another e-commerce marketplace, Wish, went public last month at $24 a share. Its share price has been below its IPO price for the most part since and is currently trading at $27.
- The three significant IPOs follow a record year in 2020 where companies raised $167B in IPOs, compared to the previous high of $108B in 1999.
- Of the nine companies that went public this year, the average increase in share price since their listing is around 50%, indicating investors' demand for new listings and their bet on long-term growth.