Some data on Emerging Growth Company IPOs so far — in Q&A format
This is a follow-up to our post from earlier this week on the newest trend in IPOs: “Emerging Growth Company” status, made possible by the JOBS Act’s “IPO On-Ramp” provision. We gathered the data using the Knowledge Mosaic SEC Filings page. (Click here to request a free trial to Knowledge Mosaic.)
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Q. What are the latest numbers on how many IPO filers have identified themselves as EGCs?
—– A. As of today, Friday, June 22, we’re showing 175.
Q. The whole rationale behind the JOBS Act’s “IPO On-Ramp” provision is to encourage companies to go public that might not have done so otherwise. The provision became effective on April 5 of this year. How many EGC IPOs were already underway on that date (with the company’s declaration of EGC status coming only later)?
—– A. Of the 175 IPOs we’ve identified, 137 were already underway as of April 5, 2012.
Q. How many EGC IPOs self-identify as EGCs in their first IPO filing?
—– A. Only 16. In other words, just 9% of companies that claim EGC status in their IPO filings did so from the get-go.
Q. Do any companies going public claim EGC status in their IPO filings prior to April 5?
—– A. No.
Q. Among all companies that began the IPO process on April 5 or after, how many now call themselves EGCs?
—– A. There have been 120 new initial public offerings since that date (includes IPOs by foreign private issuers filing Form F-1 and registered investment companies filing form N-2). 38 of those have identified themselves as EGCs.
Q. The JOBS Act specifies that an EGC cannot have “completed” an IPO before December 8, 2011. However, an EGC may have begun the IPO process at any time. How many commenced the IPO registration process before that date?
—– A. Of the 175 EGC IPOs, 64 got started before December 8, 2011. The oldest was an S-11 filed by Western Asset Mortgage Capital Corp on June 12, 2009.
Q. What is the average amount of time that passes between a company’s first IPO filing and its ECG declaration?
—– A. The average is 179 days. For 23 companies, more than a year had passed.
Q. Of the IPOs that have gone effective since December 8, how many are by self-identifying EGCs? How about since April 5?
—– A. We see 45 EGC IPOs that have gone effective overall. That’s out of 377 (12%) total IPOs declared effective after December 8, and 147 (31%) from April 5 onward.
Q. The JOBS Act does not seem to preclude EGCs from claiming that status after their IPOs have gone effective. Have any companies done that?
—– A. Yes, three companies: Midstates Petroleum Company, Inc. (IPO effective 4/19/2012); Clearsign Combustion Corp (effective 4/24/2012); and Ares Commercial Real Estate Corp (4/25/2012).
Q. How many self-declared EGCs have availed themselves of the JOBS Act provision that allows them to submit their initial IPO paperwork confidentially?
—– A. Of course, we are only able to see confidential submissions once they’re eventually disclosed via EDGAR. Using our SEC Filings page, we can positively identify four such IPOs. The companies are LegalZoom.com Inc., Tesaro Inc., Kythera Biopharmaceuticals, Inc., and (just this week) Natural Grocers by Vitamin Cottage, Inc.
Q. Which law firms have helped EGCs file IPOs via the confidential submission process?
—– A. As far as we know: Sheppard Mullin, Hogan Lovells, Latham & Watkins, and Holland & Hart (corresponding respectively to the four above).