With President Trump huffing and puffing on the trade front, investors have been distracted from the positive momentum in growth companies over the past fifteen months. The GSV 300, which is made up of the 300 fastest growing companies in the world, is up 59% since January of 2017, versus the S&P 500, which has advanced a comparatively modest 14%.
As a direct consequence, the IPO market has shown more life than it has in years, with 44 IPOs to date (55% year-over-year increase) and $23 billion in proceeds (108% year-over-year increase).
But more importantly, leaders such as Dropbox and Spotify have decided to take advantage of the healthy growth environment. The Stock Market reflects the confidence investors have in the future, and the IPO market is an even more acute indicator. If investors are pessimistic, new issues shut down. If investors are optimistic, they treat IPOs like fresh oxygen that they can’t get enough of. DBX and SPOT have been the perfect shot in the arm to keep to keep marks moving the right way. (Disclosure: GSV owns shares in Dropbox and Spotify)