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Twilio Shares Skyrocket 90% After Stock Market Debut

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Twilio Shares Skyrocket 90% After Stock Market Debut

Twilio Inc. is a communications software maker that creates ways for companies to effectively communicate with their employees and customers.

The company made its debut in the Stock Market last Thursday, where it flourished. 

Investors seeking new opportunities are said to be possibly renewing their interest in tech companies that could be risky as a result of these numbers.

The following chart gives insight over the massive gains in revenues Twilio has experienced in the past few years:

Tech IPOs 1.jpeg

Shares of the company rose an impressive 90% from the $15 original offering price, and closed at nearly $30. 

The exact closing amount was $28.53.

Twilio is a San Francisco-based company. 

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It is said that the company’s debut was so well received it could potentially increase the ambition, hope, and overall spirit of other start-up companies in California that are on the pricier side.

Drop box, a cloud company for electronic file storage, and Evernote, an app for note taking, are among these companies. 

Each produces very little in the way of profits, but IPO is viewed by both companies as an effective way to generate returns for investors that came into play early on.

User growth is an example of the statistics that result in companies such as these to be valued by Wall Street. 

Wall Street values these companies, saying that the money will begin to pour in at one point or another.

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However, last summer a wave of economic turmoil hit the world

This turmoil spread from China all the way to Britain and even in the U.S. 

This caused investors that seemed to lead risk-adverse investments to look at the tech industry and reset their overall expectations.

The following chart shows the top ten sectors for the Tehran Stock Exchange in June of 2010. 

As you can see, Technical and Engineering services fall toward the bottom of the list at 4.0%

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Investors were offered the first significant sign that opinions surrounding the Tech Industry had begun to shift on Thursday when Twilio made its stock market debut.

Matthew Kennedy explained that the IPO activity has recently chilled due to the disconnect of value taking place between both the private and public market sectors. 

However, he also stated that the IPO activity reflected investors willingness to reach growth by paying up on Thursday.

Matthew Kennedy is an analyst at Renaissance Capital. 

He is responsible for managing funds that are exchange traded with the focus on companies that are new to be listed.

Several factors influenced the benefits received by the IPO. 

These benefits came to play when the stock market lifted based on suggestions that were made stating that Britain would stay in the European Union.

It is said that the demand about supply could have been in the favor of Twilio because a limited number of shares were sold during this time. 

T. Rowe Price, an existing investor, took many of the shares himself.

Twilio may have left money sitting on the table, but the company was still able to raise $150 million through this offering.

Twilio is a company that specializes in creating software that enables companies an efficient method of communication with both their companies and employees. 

This communication takes place through text messaging, notifications by phone and some other methods. 

Alternatives for the type of services offered by Twilio include:

  • Plivo
  • Sinch
  • Nexmo

 

Uber, a ride-hailing app, is an example of how Twilio works.

They use Twilio to send a notification quickly to their riders and inform them where their car is currently located.

According to analysts, Twilio is gaining an impressive edge due to the low pricing of its initial shares. 

It is said that this was a smart plan carried out by the company to attract investors that would come with the large possibility of producing large returns; which is what happened. 

The stock can be found on the New York Stock Exchange. 

The stock can be recognized by the ticker symbol TWLO.

Kennedy further stated that Twilio is not just your average new growth buy. 

He said that Twilio offered IPO investors access to one of the public software companies experiencing the fastest growth. 

He also said that it came with the additional benefit of being provided to its peers at a discount.

Twilio is the first tech company that has valued at more than $1 billion. 

Twilio is the first tech company this year to be financed by venture capital, reach this monetary mark, and go public.

In the past few years, venture capitalists and other types of investors have been known to drive up the valuations of tech companies through some private financings. 

However, IPOs have been severely held back due to concerns that buyers in the stock market would not value the businesses on the same level.

Twilio is the biggest first-day Pop in over two years for taking. 

Here are the Top five first-day pops since the year 2014 for tech:

  • Castlight Health – 149% in March 2014
  • Varonis Systems- 100% in February 2015
  • Twilio – 92% in June 2016
  • Etsy – 88% in April 2015
  • Quote – 88% in March 2014

 

 

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