Nanosys, the nanotech start up light on revenues but full of promises, canceled its IPO this week due to “adverse market conditions.” I’ve seen this movie before, in 1996, and again in 2001. I’ve been wondering what’s up with the IPO economy lately, a fragile place built on the tenuous foundation of investor psychology. And my gut says it’s not a wonderful time to be going out. 2003 was a good year, overall, especially in the internet space. People started to believe again, interesting companies started making interesting products. And a slew of companies filed to go public, one right after the other.
For the most part, it’s still true that great companies are still making great stuff, especially in the internet space. But right now, things look pretty grim in the world, and I sense as a society we’re retreating once again into a somewhat grumpy, fearful place. As a result, IPOs leveraged over the future, like Nanosys, are being cancelled, IPOs that have narrow profit histories, like PlanetOut, are seeing their price range cut, and blockbusters, like Google, are being savaged by the pundits. Certainly it’s a good thing that there’s no appetite for hype in the world. But if I had my druthers, we’d still have a taste for hope.
The timing of the Google IPO seems odd to me. Mid-August is not a good time for IPO’s in any year. I wonder if they felt that they had to get it done as soon as possible, before the market completely collapsed.