By Jeff Brown, Editor, The Bleeding Edge I’m sure you saw the news… 2020 was a big year for high-profile initial public offerings (IPOs). Popular companies – especially technology companies – finally made their move after years of being private. Airbnb – the “Uber of lodging” – held its long-anticipated IPO in December. Palantir, a bleeding-edge company that uses artificial intelligence (AI) to extract insight from data, went public at the end of September. Snowflake, a data management software company, held a third highly publicized IPO that ended up being the largest software IPO to date. Lesser-known tech companies like Lemonade, ZoomInfo, and JFrog also hit the public markets. This is great news. It is long overdue for these companies to go public. And at the right valuation, they would be great long-term investments. But here’s the bad news. Late-Stage IPOs Airbnb, Snowflake, Palantir, and many of the other “hot” stocks being touted in the media are already mature, multibillion-dollar companies. For instance, Airbnb is 12 years old and was valued at $31 billion during its Series F funding round in 2017. As for Palantir? The company is 16 years old. It was recently valued at more than $50 billion. And Snowflake was founded back in 2012 and is already valued at $105 billion. They can still potentially be great investments. But their “early days” of exponential growth are behind them. And because these companies stayed private, retail investors never had a chance to invest. Venture capitalists and private equity groups reaped all those early returns. And in many instances, regular investors get burned when they do buy these hyped stocks. Locking Retail Investors Out For longtime readers, this will be a familiar topic. Why is it so hard to invest in exciting companies during their earliest stages of growth? Why has it been so difficult to invest in the “next Amazon” when the company is still young and the best days of growth are still ahead? The Most Profitable Prediction of Jeff Brown’s Three-Decade Technology Career It used to be that the world’s best tech companies did go public early, allowing normal investors to buy shares of these exciting startups on public exchanges. Amazon itself went public back in 1997 at a valuation of $381 million. That’s walking the line between being considered a micro-cap or a small-cap company. And, of course, it’s been well-documented that Amazon wasn’t making any money at the time. Everyday investors still had the chance to take a position in what was truly an exciting startup with an uncertain future. And those who took a chance on Amazon’s IPO got incredibly rich. The stock has gone on to deliver gains as high as 180,000%. That’s enough to turn every $10,000 invested into $18 million. All on a publicly traded stock. But the sad fact is that this isn’t remotely possible today. Average retail investors have been locked out of the best tech companies. And by the time investors do have a chance to get in, it’s often at absurd valuations. The Danger of Overhyped IPOs For example, Uber competitor Lyft went public at a $24 billion valuation in 2019. As I write, the stock is down around 40%. The We Company, of WeWork infamy, tried to go public at an absurd $47 billion valuation in late 2019. I begged my readers to steer clear of this IPO. Fortunately, the WeWork IPO was shelved, and the company has since shed 90% of its value. This is not an accident. A $49 investment could lead to you making up to 172x on your money Venture capitalists (VC) and private equity firms keep exciting companies private as long as they can because it allows them to capture the majority of the investment upside. Then, once they’ve gotten all they can, they “foist” overvalued IPOs onto unsuspecting retail investors. The reality is that normal investors are left with the equivalent of table scraps. And in some cases, they are buying into companies that are overhyped and way overvalued. Buying in at those levels is a surefire way to lose money on an investment. So what are regular investors to do? The Solution to the Problem For over five years, I’ve been on a mission to change the scenario for retail investors, trying to level the playing field. I’ve done “boots on the ground” research… dug into Securities and Exchange Commission filings… and explored many potential avenues to give my readers an edge. It hasn’t been easy. But I believe I’ve found the answer… I’ve cracked the code. And the answer is something many readers likely have never heard of. I’ve found a way to join the VCs… investing in some of the most exciting companies on the verge of their IPOs. What I’ve discovered essentially allows regular investors to profit from these companies before they go public. But you don’t need to be an accredited investor to participate. You don’t need a certain net worth. And this type of deal takes place right in your brokerage account. What I’ve discovered could be life-changing, and I can’t wait to share it with all my readers. In fact, I’m preparing for a special event where I’ll share all the details on how these deals work… how to invest in them… and how to gain access to the top deals on my radar right now. I’m calling it the Pre-IPO Code Event. It’s happening January 13 at 8 p.m. ET. Please mark that date on your calendar… and then go right here to reserve your free spot to attend. This is an event you won’t want to miss out on. I hope to see you there. Regards, Jeff Brown Editor, The Bleeding Edge Like what you’re reading? Send your thoughts to feedback@brownstoneresearch.com. In Case You Missed It… Design "mistake" in Tesla's Gigafactory? In Tesla’s massive Gigafactory, where they make batteries for their popular electric cars. There is something strange… One wall of the factory is far different than the others. Maybe it was a mistake. Or a flaw in the design. But there’s a secret reason for it. And it may have something to do with a tiny company – sitting on a $35 billion fortune. This video reveals the potentially lucrative truth. |
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