Ride-hailing giant Uber went public on the New York Stock Exchange late last week, but things didn’t go exactly as they’d like.
Shares in the company began trading at $45 but by the end of transactions on Friday, they had fallen to $41.57. This fall gave the company a market capitalization of around $76.5 billion, significantly less than the $120 billion figure spruiked by some company insiders last year prior to the company’s initial public offering.
Uber managed to raise almost $25 billion in 23 rounds of financing prior to its IPO and went public approximately six weeks after key rival Lyft was listed on the NASDAQ. Its IPO was the largest in the past five years, but senior IPO market strategist at Renaissance Capital, Matt Kennedy, reports that just 10 per cent of U.S. technology companies backed by venture capital to go public in the last five years have finished their first day of trading below their IPO price.
“It’s a great moment for the company and all the employees who have been working so hard to get here,” Uber chief executive Dara Khosrowshahi said. “It was a tough week to go public, but we got it done.”
“Our company is not a fair-weather company. We keep moving forward in tough and easy environments, and I think that we as a company will be a great investment over the long term,” Khosrowshahi added.
The fall in Uber’s share price may have been due to doubts that ride-hailing companies like it can make money. Since Lyft went public on March 29 with a share price of $78.29, its shares fell to a low of $51.09 on May 10, News reports.