A flurry of stock market debuts, from Uber to Airbnb, has many speculating how more wealth will affect the city
Several big-name tech companies are set to enter the public market, and the speculation over the effects of a crush of overnight millionaires overwhelming the region has reached fever pitch.
The San Francisco-based companies Uber, Lyft, AirBnb, Pinterest, Postmates and Slack are all expected to sell stock for the first time in the coming weeks, allowing tens of thousands of employees currently holding shares to grow their personal wealth exponentially, instantaneously.
Companies go public every day without any sort of fanfare or attention, but it’s not often that so many companies with high valuations will do so within such a relatively short time frame – and all within blocks of each other in a city already ravaged by the economic disparities created by the tech boom.
As with any initial public offering (IPO), it’s impossible to say how well the companies will do. But even the most conservative of calculations are predicting flurries of cash raining upon a city already ankle-deep in water.
Lyft, going first on Thursday, is hoping to enter the market somewhere between $20bn to $25bn, while its rival Uber is valued at a jaw-dropping $120bn. Pinterest was last valued at $12.3bn, while AirBnb is estimated at $38bn
Economists have no case studies to look back on to anticipate what kind of effect this event will have on San Francisco. Twitter, which entered the stock market in 2013 at $24bn, was at the time one of the only major Silicon Valley tech companies headquartered in San Francisco. Facebook debuted at $104bnin 2012, but its Menlo Park headquarters meant the effects of sudden wealth weren’t as concentrated in one location.
“Just to put things on a Twitter scale, if Twitter was a normal big IPO, Lyft is aiming to be as big as Twitter was,” said Ted Egan, the chief economist for San Francisco’s office of economic analysis. “Uber is aiming to be five times as big as Twitter, and AirBnb is going to be the size of Twitter. If you think them all as earthquakes, and they all hit at around the same time, you will notice that.”