U.S. IPO Weekly Recap: Blue Apron Delivers Its IPO Filing

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Includes: APRN, MRSN
by: Renaissance Capital IPO Research

KBL Merger Corp. IV (NASDAQ:KBLMU) raised $100 million in the year's 11th SPAC IPO - the only offering during a short holiday week. However, the biggest news arrived on Thursday when meal kit unicorn Blue Apron filed for a US IPO.

Seven new filings led by Blue Apron and Tintri

Seven companies joined the IPO pipeline this past week. Fast-growing meal kit provider Blue Apron (APRON) filed for an IPO we estimate should raise over $200 million. It has shown impressive growth at scale, with revenue up +133% in 2016 to nearly $800 million. However, high marketing costs have kept it unprofitable. Backed by Bessemer Venture Partners, Blue Apron was reportedly valued at $2 billion in June 2015.

Another notable tech filing, storage appliance provider Tintri (TNTR) filed to raise $100 million. Backed by NEA and Silver Lake, Tintri also pairs high growth with high losses.

The week's five other initial filings came from three biotechs (Mersana Therapeutics (NASDAQ:MRSN), Dova Pharmaceuticals (NASDAQ:DOVA), Aileron Therapeutics (ALRN)) and two regional banks (Byline Bancorp (NYSE:BY), Esquire Financial (NASDAQ:ESQ)). We also saw two new SPAC filings (Bison Capital Acquisition (NASDAQ:BCACU), Hennessy Capital Acquisition (NYSEMKT:HCAC.U)).

May 2017 wrap-up

In May, 17 IPOs raised $3.6 billion, coming in slightly below April in terms of deal count and proceeds. Average returns were strong at +15%. A modest decline in filing activity also suggests that June could be less robust than anticipated. However, a sea of pre-IPO companies and good market conditions should encourage a pick-up in activity toward the end of June and heading into July.

2Q17 is going strong

Even before any June IPOs, the 2Q17 is already the most active by deal count going back eight quarters. 78% of 2Q17 IPOs are above issue, the highest among the past 10 quarters.

IPO Market Enters June with 78% of Second Quarter IPOs Above Issue

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

4Q16

1Q17

2Q17
thru May

IPOs

34

70

34

32

8

34

33

30

25

37

Proceeds ($B)

$5.5

$12.7

$5.1

$6.8

$0.7

$5.5

$5.7

$6.9

$9.9

$7.3

IPOs Above Issue (5/31/17)

41%

43%

44%

63%

50%

62%

70%

50%

60%

78%

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. The Renaissance IPO Index is up 23.7% year-to-date, far ahead of the S&P 500, up 8.9%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include Ferrari (NYSE:RACE) and TransUnion (NYSE:TRU). The Renaissance International IPO Index is up 16.4% year-to-date, while the ACWX is up 15.9%. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include Worldpay and ABN Amro.