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Wall Street Breakfast: Trade Comes Back Into Focus

on February 7, 2020

Planning to list on the NYSE today under ticker “CSPR,” Casper has priced its initial public stock offering at $12 a share, down from an earlier range of $17 to $19. That values the company at around $500M, down from the $705M it valued itself at last week, and a significant hit for the mattress company that once prided itself as a unicorn. “The days of growth at any cost are over,” said Santosh Rao, who researches IPOs for Manhattan Venture Research. “You either have to be profitable, or take a haircut.”

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Casper IPO reflects investor sentiment toward money-losing companies

on February 6, 2020

“The days of growth at any cost are over,” said  Santosh Rao, who researches IPOs for Manhattan Venture Research. “You either have to be profitable, or take a haircut.”

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Turo Adds Another $30M To Series E

on February 5, 2020

The new round of funding brings Turo’s total funding to $500 million, and adds Manhattan Venture Partners and Allen & Co as investors in the company. Through Manhattan Venture Partners, Fitzgerald, 2 Chainz, NBA players Victor Oladipo, Langston Galloway, and Thad Young, and NFL players Dee Ford, Tyrod Taylor, Malcolm Jenkins, and Clint McDonald are now shareholders in the company.

Manhattan Venture Partners is somewhat known for bringing a celebrity touch to private company funding rounds. The VC firm has an “All-Star Fund,” that helps celebrities and athletes invest in private companies.

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Stripe ripe for stock market listing, says US-based analyst

on February 4, 2020

Stripe, the online payments company founded by Limerick brothers Patrick and John Collison, is “ripe for an initial public offering (IPO),” according to Manhattan Venture Research in New York.

While the fast-growing company has repeatedly said it has no plans to seek a market listing, Santosh Rao, head of research at Manhattan, notes that the fintech space “has been buzzing with activity”, with consolidation the name of the game.

In Manhattan’s recent Venture Bytes monthly report, Mr Rao highlights a number of fintech-focused “megadeals” that have taken place over the past 12 months. These include Fis’s $43 billion (€39 billion) deal for Worldpay, Fiserv’s £22 billion (€26 billion) acquisition of First Data, and Global Payments $21.5 billion purchase of TSYS.

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The fall of WeWork was a jolt to venture capital—how that could change VC investing

on January 22, 2020

When news broke in September that SoftBank-backed WeWork was pulling its doomed IPO, a chill ran across the capital markets.

Mere days before, entertainment and talent agency Endeavor had also pulled its IPO. In December, following disappointing growth, SoftBank sold back its nearly 50% stake in late-stage dog-walking startup Wag Labs to the company. And according to reports, pizza startup Zume was in talks with SoftBank to raise another funding round in late 2019, but the deal fell apart in December (the company subsequently laid off hundreds of workers in January).

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New stocks are red hot to start 2020 with IPO ETF tripling the return of the market

on January 22, 2020

IPO watchers expect the 2020 market to be front-half loaded due to a big second-half event: the presidential elections.

“In an election year, IPO issuance is traditionally strong in the first two quarters, slow in the third quarter, then picks up in the end of the fourth quarter,” said Santosh Rao, head of research at Manhattan Venture Research.

“My best guess is the biggest names will try to come out well before the election,” he said.

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Hedge fund puts $550m into technology stock option financing

on January 14, 2020

Privately held start-ups have typically not been keen to see employees enter contracts backed by their shares and options. But Andrea Walne, a partner at Manhattan Venture Partners, said with more than a dozen groups now offering financing tied to start-up stocks and options, she hoped a marketplace would develop.  “Companies have been leaning far too much on their inability to provide financial and tax advice as a cop out to supporting employees with their stock options,” Mrs Walne said.

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Phase I of Sino-US Trade trade pact a done deal, Phase II likely after the elections: Santosh Rao

on January 13, 2020

Santosh Rao of Manhattan Venture Partners, says both China and the US need the trade deal and it will be a step in the right direction for the global economy. In an interview with ETNOW, he said nothing can derail the US markets in 2020 unless a huge macro event takes place.

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What does the ‘WeWork effect’ mean for IPOs in 2020?

on December 31, 2019

Stripe surpassed Airbnb as the most valuable private company in 2019 thanks to a valuation of $35 billion as of a September 2019 funding round. The company sits in the hot intersection of payments and software, working with companies such as Lyft, Uber and Glossier on payment processing, payouts to contractors and card issuing. E-commerce sales are picking up, and Stripe “does the back end for those kinds of businesses,” riding the rising tide of the online economy, said Santosh Rao, head of research and a partner at Manhattan Venture Partners.

The company has been expanding geographically and adding new enterprise capabilities as it goes up against companies such as PayPal Holdings Inc. PYPL, -0.31% , Square Inc. SQ, +1.20% and Adyen NV ADYEN, +0.00% . Though co-founder John Collison told CNBC earlier this year that the company had “no plans” for an immediate IPO, the company still cracks Rao’s short list. A Stripe spokesman reiterated in an email that there are “no plans” for the company to go public.

There are two other fintech names on Rao’s list: Klarna, which powers installment-payment options and nabbed a $1.4 billion valuation on the private market back in 2014, and Toast, which makes payments products for restaurants and fetched a $2.7 billion private valuation in early 2019.

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Uber and other unicorns flopped on Wall Street this year. Will IPOs rebound in 2020?

on December 16, 2019

Investors are also betting that food delivery service Postmates, trading app Robinhood and mattress seller Casper could make waves if they debut on Wall Street.

“2020 could be a good year for the IPO market. There is a tremendous pipeline. IPOs are not broken but the bar has changed. Before there was no bar,” said Santosh Rao, head of research at Manhattan Venture Partners, in an interview with CNN Business.

“Investors are now more demanding and want sustainable business models,” he added.

Rao is bullish on the prospects for Airbnb and Postmates if they go public next year. He’s also keeping a close eye on Postmates rival DoorDash, payments company Stripe, Big Data giant Palantir and Chinese ridesharing firm Didi.

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