Embed Size (px)
Citation preview
© Capital Markets Advisory Partners, LLC
David Weild
212.542.9979
The IPO Crisis And What Must Be Done To Fix It: Market structure is too low cost to pay for the infrastructure needed to support capital formation.Improved strategies are needed. We offer some.
SoHo Loft
Reed Smith
599 Lexington Avenue
22nd Floor
New York, NY
January 22-23, 2012
© Capital Markets Advisory Partners, LLC2
Our Focus
• Change Agent (Supported by Grant Thornton)
– Studies
• Why are IPOs in the ICU?
• A wake up call for America
• Market structure is causing the IPO crisis – and more
• Killing the stock market that laid the golden eggs (pending chapter in “Broken
Markets” to be published by John Wiley & Sons)
– Citations
• Congress, Senate, SEC
• IPO Task Force Report to the US Treasury
• Jeffrey Immelt led Jobs Council Report to the White House
• Solutions for Issuers (Capital Markets Advisory Partners)
– How to significantly increase size and quality of institutional
demand.
• Cut deal execution risk
• Improve price
• Improve aftermarket performance
© Capital Markets Advisory Partners, LLC3
The small IPO market collapsed with the OHRs and Reg. ATS (loss of B/D incentives)As seen in the study "Market structure is causing the IPO crisis—and more"
Sources: Grant Thornton LLP, Capital Markets Advisory Partners and Dealogic
Data includes corporate IPOs as of 6/30/11, excluding funds, REITs, SPACs and LPs
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD
Transactions raising less than $50 million
Transactions raising at least $50 million
Percent of total U.S. IPOs
Sarbanes-Oxley (2002)
OHRs (1997)
Manning Rule (1996)Allegations of Spread Fixing (1994)
Regulation ATS (1998)
Decimalization (2001)
Reg. NMS (2005)
© Capital Markets Advisory Partners, LLC
*March 16, 2011; House Financial Services Committee “Hearing on Legislative Proposals to Promote Job Growth, Capital Formation and Market Certainty”
statement by David Weild
4
A catastrophic fall in the number of listed companies (43%)As seen in the study "A wake up call for America"*
(100)
(50)
0
50
100
150
200
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD
Ind
ex
ed
va
lue
of s
ele
cte
d g
lob
al e
xc
ha
ng
e li
sti
ng
s
(19
97
= 0
)
China
Australia
Germany
Tokyo
London Toronto
United States
Hong Kong
Sources: Grant Thornton LLP, Capital Markets Advisory Partners, World Federation of Exchanges and individual stock exchanges
© Capital Markets Advisory Partners, LLC
• H.R. 1070 (Reg. A)
• H.R. 1965 (banks; 500-2,000 shareholders)
• H.R. 2940 (general solicitation, Reg. D)
• H.R. 2930 (crowdfunding)
• H.R. 2167 (500-1,000 shareholders)
Disclosure
Standards
Current legislation will help but won’t do nearly enough to fix our stock markets.
• H.R. 1070 (Reg. A)
• H.R. 2930 (crowdfunding)
Private
Public
Private
Public
Private
Public
© Capital Markets Advisory Partners, LLC6
IPO success rates have been in sustained decline for nearly two decades, despite deals that are increasing in average size and maturity
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
Success rate of trailing 30 IPO filings
© Capital Markets Advisory Partners, LLC
0%
1%
2%
3%
4%
1960s 1970s 1980s 1990s 2000s 2010s*
Closing price volatility
0%
1%
2%
3%
4%
1960s 1970s 1980s 1990s 2000s 2010s*
Intraday price volatility
Excluding2008 and 2009
7
Unprecedented volatility (S&P 500)Standard & Poor's 500 index moves of 4% or higher
*Analysis through 9/30/11
Source: Grant Thornton LLP, Capital Markets Advisory Partners and Capital IQ
Original analysis from "Market Swings are Becoming New Standard," New York Times, September 11, 2011
© Capital Markets Advisory Partners, LLC8
IPOs take > 3 times as long to get through the SEC than they did 20 years ago
Number of days in registration
(Trailing 30-deal average)
© Capital Markets Advisory Partners, LLC
$0
$20
$40
$60
$80
$100
$120
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD
U.S
. Ven
ture
Cap
ital R
ais
ed
(In
Billio
ns)
0
100
200
300
400
500
600
700
800
900
0%
2%
4%
6%
8%
10%
12%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD
Nu
mb
er
of U
.S. IP
Os
U.S
. U
nem
plo
ym
en
t R
ate
"Penny Stocks" Deal Size < $50 Milllion Deal Size ≥ $50 Million U.S. Unemployment Rate
9
We would have enjoyed a venture-backed post 1990s 'IPO Echo Boom,' but Reg. ATS killed it
Source: National Venture Capital Association
Data as of 6/30/11
Sources: Grant Thornton LLP, Capital Markets Advisory Partners, Dealogic and U.S. Department of Labor
Data includes corporate IPOs as of 6/30/11, excluding funds, REITs, SPACs and LPs
© Capital Markets Advisory Partners, LLC
0
100
200
300
400
500
600
700
800
900
0%
2%
4%
6%
8%
10%
12%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD
Nu
mb
er
of U
.S. IP
Os
U.S
. Un
em
plo
ym
en
t R
ate
"Penny Stocks" Deal Size < $50 Milllion Deal Size ≥ $50 Million U.S. Unemployment Rate
10
We believe the loss of small IPOs is a major contributor to job loss in the United StatesAs seen in the study "Market structure is causing the IPO crisis—and more"
Sources: Grant Thornton LLP, Capital Markets Advisory Partners, Dealogic and U.S. Department of Labor
Data includes corporate IPOs as of 6/30/11, excluding funds, REITs, SPACs and LPs
© Capital Markets Advisory Partners, LLC11
We should be approaching 1,000 IPOs/year and < 5% unemployment
The 'U.S. IPOs (Projected)' estimate assumes 520 IPOs per year starting in 1991 with a 3% compound annual growth rate equivalent to
the U.S. GDP growth rate. A simple linear regression model was created using historical data to predict the 'U.S. Unemployment Rate
(Projected)' based on this number of projected IPOs.
Sources: Grant Thornton LLP, Capital Markets Advisory Partners, Dealogic and U.S. Department of Labor
Data includes corporate IPOs as of 6/30/11, excluding funds, REITs, SPACs and LPs
-
100
200
300
400
500
600
700
800
900
1,000
0%
2%
4%
6%
8%
10%
12%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Est.
2012 Est.
2013 Est.
Nu
mb
er
of U
.S. IP
Os
U.S
. Un
em
plo
ym
en
t R
ate
U.S. IPOs (Actual) U.S. IPOs (Projected)
U.S. Unemployment Rate (Actual) U.S. Unemployment Rate (Projected)
© Capital Markets Advisory Partners, LLC12
IPOs > $500 million have demonstrated the steepest decline of all
Success rate of trailing 30 IPO filings
with proceeds of at least $500 million
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC
Loss of the Ecosystem: Underwriting Groups
Microsoft’s IPO (1986) vs. LinkedIn’s IPO (2011)
13
© Capital Markets Advisory Partners, LLC
Source: Microsoft IPO Final Prospectus, Capital Markets Advisory Partners, LLC.
14
Microsoft IPO: $58,695,000 March 13, 1986Underwriter Table from Final Prospectus 116 Underwriters (p. 1 of 3)
© Capital Markets Advisory Partners, LLC15
Microsoft IPO: $58,695,000 March 13, 1986Underwriter Table from Final Prospectus 116 underwriters (p. 2 of 3)
Source: Microsoft IPO Final Prospectus, Capital Markets Advisory Partners, LLC.
© Capital Markets Advisory Partners, LLC16
Microsoft IPO: $58,695,000 March 13, 1986Underwriter Table from Final Prospectus 116 underwriters (p. 3 of 3)
Source: Microsoft IPO Final Prospectus, Capital Markets Advisory Partners, LLC.
© Capital Markets Advisory Partners, LLC
Source: LinkedIn IPO Final Prospectus
17
LinkedIn IPO: $352,800,000 May 18, 2011 Underwriter Table from Final Prospectus 5 underwriters
© Capital Markets Advisory Partners, LLC
• Issuer’s Choice - Board Chooses “Tick Size” - Issuers deserve choice in
how the market in their shares is made and supported (“Mass Customization”)
– Issuer Boards of Directors should be allowed to determine „tick size‟ which would cost
little to implement and provide an important tool to impact support (research, sales
and capital) and modulate speculative trading and volatility.
• Alternative Sub $2 Billion Market Cap Stock Market - Issuers (and
Americans) deserve a sub-$2 billion market cap stock market structured to
create focus on capital formation and job creation (see Wall Street Journal Op-
ed dated October 28, 2011, entitled “How to Revive Small-Cap IPOs”)
Two Solutions (Both address the economic model)
18
© Capital Markets Advisory Partners, LLC
Capital Markets Advisory Partners:
Solutions for Issuers
19
© Capital Markets Advisory Partners, LLC20
The best investors are now self-directed. We work with management to reach them.
Wall Street Adjusted
(Each change increased selling)
• Focused on big, large cap
funds
• Focused on big, high
turnover funds
• Shut down middle-market
institutional sales forces
• Converted retail from stock
broking to asset gathering
We help Issuers Adjust
(Each step increases placement)
• Methods to reach the self-
directed 2/3rds of the
institutional market
• Methods to minimize
selling pressure
• Methods to promote retail
ownership
• Campaign to improve the
stock markets for issuers
© Capital Markets Advisory Partners, LLC21
$0
$1,000,000,000,000
$2,000,000,000,000
$3,000,000,000,000
$4,000,000,000,000
$5,000,000,000,000
$6,000,000,000,000
$7,000,000,000,000
$8,000,000,000,000
Tier 1
Tier 2
Tier 3
Tier 4
Tier 5
Tier 6
Tier 7
Tier 8
Tier 9
Tier 10
Tier 11
Tier 12
Tier 13
Tier 14
Tier 15
Tier 16
Tier 17
Tier 18
Tier 19
Tier 20
Tier 21
Tier 22
Tier 23
Tier 24
Tier 25
Tier 26
Tier 27
Tier 28
Tier 29
Tier 30
Tier 31
Tier 32
Tier 33
Tier 34
Tier 35
Tier 36
Eq
uit
y A
ssets
Market Value ≤ $2 billion Market Value > $2 billion
2010
21
Wall Street Not Reaching Best InvestorsDistribution of fundamentally oriented U.S. institutions in 2010Each tier = 100* institutions ranked by equity assets (e.g., 1st tier = top 100 institutions)
*36th tier = 43 institutions
© Capital Markets Advisory Partners, LLC22
$0
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
Je
nn
iso
n A
sso
cia
tes L
LC
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
Inte
l Co
rp. P
en
sio
n F
un
d
Art
isa
n P
art
ne
rs L
P
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Am
eri
ca
n C
en
tury
Inve
stm
en
t …
TC
W A
sse
t M
an
ag
em
en
t Co
., I
nc.
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Op
pe
nh
eim
erF
un
ds, I
nc.
We
llin
gto
n M
an
ag
em
en
t Co
. LL
P
Win
slo
w C
ap
ita
l Ma
na
ge
me
nt, In
c.
Go
od
ma
n &
Co
. In
ve
stm
en
t C
ou
nse
l Ltd
.
Th
rive
nt I
nve
stm
en
t Ma
na
ge
me
nt, In
c.
Mo
rga
n S
tan
ley S
mith
Ba
rne
y L
LC
…
Atla
nta
Ca
pita
l Ma
na
ge
me
nt C
o. L
LC
Allia
nce
Be
rnste
in L
P
Re
na
issa
nce
Te
ch
no
log
ies L
LC
Co
na
tus C
ap
ita
l
Tw
o S
igm
a In
ve
stm
en
ts L
LC
RB
C G
lob
al A
sse
t M
an
ag
em
en
t, In
c.
Co
lum
bia
Ma
na
ge
me
nt I
nve
stm
en
t …
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Cri
teri
on
Ca
pita
l Ma
na
ge
me
nt L
LC
Hig
hb
rid
ge
Ca
pita
l Ma
na
ge
me
nt L
LC
D. E
. S
ha
w &
Co
., In
c.
Pie
dm
on
t In
ve
stm
en
t Ad
vis
ors
LL
C
Ge
ne
va
Inve
stm
en
t Ma
na
ge
me
nt o
f …
Pa
rtn
er F
un
d M
an
ag
em
en
t LP
Su
mito
mo
Tru
st &
Ba
nkin
g C
o. L
td. …
Miu
ra G
lob
al M
an
ag
em
en
t LL
C
Mic
hig
an
De
pa
rtm
en
t of Tre
asu
ry
Aly
da
r P
art
ne
rs L
LC
De
uts
ch
e B
an
k In
ve
stm
en
t Ma
na
ge
me
nt, …
Ne
ptu
ne
Inve
stm
en
t Ma
na
ge
me
nt L
td.
RC
M C
ap
ita
l Ma
na
ge
me
nt L
LC
Mo
rga
n S
tan
ley In
ve
stm
en
t Ma
na
ge
me
nt, …
UB
S G
lob
al A
sse
t M
an
ag
em
en
t
Em
pir
e C
ap
ita
l Ma
na
ge
me
nt L
LC
Kle
inh
ein
z C
ap
ita
l Pa
rtn
ers
, In
c.
Vic
tory
Ca
pita
l Ma
na
ge
me
nt, In
c.
Ru
sse
ll In
ve
stm
en
t Ma
na
ge
me
nt C
o.
Ma
rvin
& P
alm
er A
sso
cia
tes, In
c.
S.A
.C. C
ap
ita
l Ad
vis
ors
LP
Bla
ckR
ock In
ve
stm
en
t Ma
na
ge
me
nt (
UK
) …
Lo
om
is, S
ayle
s &
Co
. L
P
Le
ga
l & G
en
era
l In
ve
stm
en
t M
an
ag
em
en
t …
He
nd
ers
on
Glo
ba
l In
ve
sto
rs L
td.
JP
Mo
rga
n A
sse
t M
an
ag
em
en
t, In
c.
Ma
cke
nzie
Fin
an
cia
l Co
rp.
Ma
rke
t V
alu
e o
f S
ha
res
He
ld
22
Top 50 fundamental institutional investors ranked by market value of shares held
are mostly smaller investors that are not the focus of large investment banks
Market Cap. $42.04 BVMware Inc.
© Capital Markets Advisory Partners, LLC23
$0
$100,000,000,000
$200,000,000,000
$300,000,000,000
$400,000,000,000
$500,000,000,000
$600,000,000,000
Je
nn
iso
n A
sso
cia
tes L
LC
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
Inte
l Co
rp. P
en
sio
n F
un
d
Art
isa
n P
art
ne
rs L
P
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Am
eri
ca
n C
en
tury
Inve
stm
en
t …
TC
W A
sse
t M
an
ag
em
en
t Co
., I
nc.
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Op
pe
nh
eim
erF
un
ds, I
nc.
We
llin
gto
n M
an
ag
em
en
t Co
. LL
P
Win
slo
w C
ap
ita
l Ma
na
ge
me
nt, In
c.
Go
od
ma
n &
Co
. In
ve
stm
en
t C
ou
nse
l Ltd
.
Th
rive
nt I
nve
stm
en
t Ma
na
ge
me
nt, In
c.
Mo
rga
n S
tan
ley S
mith
Ba
rne
y L
LC
…
Atla
nta
Ca
pita
l Ma
na
ge
me
nt C
o. L
LC
Allia
nce
Be
rnste
in L
P
Re
na
issa
nce
Te
ch
no
log
ies L
LC
Co
na
tus C
ap
ita
l
Tw
o S
igm
a In
ve
stm
en
ts L
LC
RB
C G
lob
al A
sse
t M
an
ag
em
en
t, In
c.
Co
lum
bia
Ma
na
ge
me
nt I
nve
stm
en
t …
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Cri
teri
on
Ca
pita
l Ma
na
ge
me
nt L
LC
Hig
hb
rid
ge
Ca
pita
l Ma
na
ge
me
nt L
LC
D. E
. S
ha
w &
Co
., In
c.
Pie
dm
on
t In
ve
stm
en
t Ad
vis
ors
LL
C
Ge
ne
va
Inve
stm
en
t Ma
na
ge
me
nt o
f …
Pa
rtn
er F
un
d M
an
ag
em
en
t LP
Su
mito
mo
Tru
st &
Ba
nkin
g C
o. L
td. …
Miu
ra G
lob
al M
an
ag
em
en
t LL
C
Mic
hig
an
De
pa
rtm
en
t of Tre
asu
ry
Aly
da
r P
art
ne
rs L
LC
De
uts
ch
e B
an
k In
ve
stm
en
t Ma
na
ge
me
nt, …
Ne
ptu
ne
Inve
stm
en
t Ma
na
ge
me
nt L
td.
RC
M C
ap
ita
l Ma
na
ge
me
nt L
LC
Mo
rga
n S
tan
ley In
ve
stm
en
t Ma
na
ge
me
nt, …
UB
S G
lob
al A
sse
t M
an
ag
em
en
t
Em
pir
e C
ap
ita
l Ma
na
ge
me
nt L
LC
Kle
inh
ein
z C
ap
ita
l Pa
rtn
ers
, In
c.
Vic
tory
Ca
pita
l Ma
na
ge
me
nt, In
c.
Ru
sse
ll In
ve
stm
en
t Ma
na
ge
me
nt C
o.
Ma
rvin
& P
alm
er A
sso
cia
tes, In
c.
S.A
.C. C
ap
ita
l Ad
vis
ors
LP
Bla
ckR
ock In
ve
stm
en
t Ma
na
ge
me
nt (
UK
) …
Lo
om
is, S
ayle
s &
Co
. L
P
Le
ga
l & G
en
era
l In
ve
stm
en
t M
an
ag
em
en
t …
He
nd
ers
on
Glo
ba
l In
ve
sto
rs L
td.
JP
Mo
rga
n A
sse
t M
an
ag
em
en
t, In
c.
Ma
cke
nzie
Fin
an
cia
l Co
rp.
To
tal E
qu
ity A
ss
ets
23
VMware Inc.48% (24 of 50) of VMware investors are below the priority line of most investment banks.
Market Cap. $42.04 B
Coverage
from bulge
bracket
firms
erodes here
© Capital Markets Advisory Partners, LLC24
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
$140,000,000
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
We
lls C
ap
ita
l Ma
na
ge
me
nt, In
c.
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Fre
d A
lge
r M
an
ag
em
en
t, In
c.
Ce
ntu
ry C
ap
ita
l Ma
na
ge
me
nt L
LC
Co
lum
bia
Ma
na
ge
me
nt I
nve
stm
en
t …
JP
Mo
rga
n A
sse
t M
an
ag
em
en
t, In
c.
Allia
nce
Be
rnste
in L
P
Ch
am
pla
in In
ve
stm
en
t Pa
rtn
ers
LL
C
Arb
or
Ca
pita
l Ma
na
ge
me
nt L
LC
(M
inn
eso
ta)
Lu
the
r K
ing
Ca
pita
l Ma
na
ge
me
nt C
orp
.
Blu
efi
n In
ve
stm
en
t Ma
na
ge
me
nt
MF
S In
ve
stm
en
t M
an
ag
em
en
t, In
c.
Art
isa
n P
art
ne
rs L
P
De
uts
ch
e B
an
k In
ve
stm
en
t Ma
na
ge
me
nt, …
Op
pe
nh
eim
erF
un
ds, I
nc.
Ne
xt C
en
tury
Gro
wth
In
ve
sto
rs L
LC
Ab
erd
ee
n A
sse
t Ma
na
ge
me
nt, In
c.
ING
In
ve
stm
en
t M
an
ag
em
en
t Co
.
Bro
ad
vie
w A
dvis
ors
LL
C
Pa
lisa
de
Ca
pita
l Ma
na
ge
me
nt L
LC
Ash
ford
Ca
pita
l Ma
na
ge
me
nt, In
c.
De
law
are
Ma
na
ge
me
nt B
usin
ess T
rust
Dre
yfu
s In
ve
stm
en
t Ad
vis
ors
, In
c.
Ch
art
we
ll In
ve
stm
en
t Pa
rtn
ers
LP
Co
lum
bia
Pa
rtn
ers
LL
C In
ve
stm
en
t …
Ad
ag
e C
ap
ita
l Ad
vis
ors
LL
C
Ro
be
co
Institu
tio
na
l Asse
t Ma
na
ge
me
nt B
V
Em
era
ld A
dvis
ers
, In
c.
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Re
na
issa
nce
Te
ch
no
log
ies L
LC
Mu
tua
l of A
me
rica
Ca
pita
l Ma
na
ge
me
nt …
Ba
nk o
f N
ew
Yo
rk M
ello
n A
sse
t …
Ru
sse
ll In
ve
stm
en
t Ma
na
ge
me
nt C
o.
NC
M C
ap
ita
l Ma
na
ge
me
nt G
rou
p, In
c.
Ha
rve
y P
art
ne
rs L
LC
Inve
sco
Po
we
rSh
are
s C
ap
ita
l …
RS
Inve
stm
en
t Ma
na
ge
me
nt C
o.
LL
C
Ch
ino
ok C
ap
ita
l Ma
na
ge
me
nt L
LC
Sig
ma
Ca
pita
l Ma
na
ge
me
nt L
LC
Azim
ut S
GR
Sp
A
Ob
erw
eis
Asse
t M
an
ag
em
en
t, In
c.
Go
ldm
an
Sa
ch
s A
sse
t M
an
ag
em
en
t LP
Bla
ckR
ock In
ve
stm
en
t Ma
na
ge
me
nt (
UK
) …
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Co
pp
er R
ock C
ap
ita
l Pa
rtn
ers
LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Ma
cG
uir
e, C
he
sw
ick &
Tu
ttle
In
ve
stm
en
t …
Th
e P
ub
lic S
ecto
r P
en
sio
n In
ve
stm
en
t Bo
ard
Pri
ncip
al G
lob
al I
nve
sto
rs L
LC
Ma
rke
t V
alu
e o
f S
ha
res
He
ld
24
Top 50 fundamental institutional investors ranked by market value of shares held
are mostly smaller investors that are not the focus of large investment banks
Market Cap. $1.02 BLogMeIn Inc.
© Capital Markets Advisory Partners, LLC25
$0
$100,000,000,000
$200,000,000,000
$300,000,000,000
$400,000,000,000
$500,000,000,000
$600,000,000,000
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
We
lls C
ap
ita
l Ma
na
ge
me
nt, In
c.
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Fre
d A
lge
r M
an
ag
em
en
t, In
c.
Ce
ntu
ry C
ap
ita
l Ma
na
ge
me
nt L
LC
Co
lum
bia
Ma
na
ge
me
nt I
nve
stm
en
t …
JP
Mo
rga
n A
sse
t M
an
ag
em
en
t, In
c.
Allia
nce
Be
rnste
in L
P
Ch
am
pla
in In
ve
stm
en
t Pa
rtn
ers
LL
C
Arb
or
Ca
pita
l Ma
na
ge
me
nt L
LC
(M
inn
eso
ta)
Lu
the
r K
ing
Ca
pita
l Ma
na
ge
me
nt C
orp
.
Blu
efi
n In
ve
stm
en
t Ma
na
ge
me
nt
MF
S In
ve
stm
en
t M
an
ag
em
en
t, In
c.
Art
isa
n P
art
ne
rs L
P
De
uts
ch
e B
an
k In
ve
stm
en
t Ma
na
ge
me
nt, …
Op
pe
nh
eim
erF
un
ds, I
nc.
Ne
xt C
en
tury
Gro
wth
In
ve
sto
rs L
LC
Ab
erd
ee
n A
sse
t Ma
na
ge
me
nt, In
c.
ING
In
ve
stm
en
t M
an
ag
em
en
t Co
.
Bro
ad
vie
w A
dvis
ors
LL
C
Pa
lisa
de
Ca
pita
l Ma
na
ge
me
nt L
LC
Ash
ford
Ca
pita
l Ma
na
ge
me
nt, In
c.
De
law
are
Ma
na
ge
me
nt B
usin
ess T
rust
Dre
yfu
s In
ve
stm
en
t Ad
vis
ors
, In
c.
Ch
art
we
ll In
ve
stm
en
t Pa
rtn
ers
LP
Co
lum
bia
Pa
rtn
ers
LL
C In
ve
stm
en
t …
Ad
ag
e C
ap
ita
l Ad
vis
ors
LL
C
Ro
be
co
Institu
tio
na
l Asse
t Ma
na
ge
me
nt B
V
Em
era
ld A
dvis
ers
, In
c.
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Re
na
issa
nce
Te
ch
no
log
ies L
LC
Mu
tua
l of A
me
rica
Ca
pita
l Ma
na
ge
me
nt …
Ba
nk o
f N
ew
Yo
rk M
ello
n A
sse
t …
Ru
sse
ll In
ve
stm
en
t Ma
na
ge
me
nt C
o.
NC
M C
ap
ita
l Ma
na
ge
me
nt G
rou
p, In
c.
Ha
rve
y P
art
ne
rs L
LC
Inve
sco
Po
we
rSh
are
s C
ap
ita
l …
RS
Inve
stm
en
t Ma
na
ge
me
nt C
o.
LL
C
Ch
ino
ok C
ap
ita
l Ma
na
ge
me
nt L
LC
Sig
ma
Ca
pita
l Ma
na
ge
me
nt L
LC
Azim
ut S
GR
Sp
A
Ob
erw
eis
Asse
t M
an
ag
em
en
t, In
c.
Go
ldm
an
Sa
ch
s A
sse
t M
an
ag
em
en
t LP
Bla
ckR
ock In
ve
stm
en
t Ma
na
ge
me
nt (
UK
) …
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Co
pp
er R
ock C
ap
ita
l Pa
rtn
ers
LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Ma
cG
uir
e, C
he
sw
ick &
Tu
ttle
In
ve
stm
en
t …
Th
e P
ub
lic S
ecto
r P
en
sio
n In
ve
stm
en
t Bo
ard
Pri
ncip
al G
lob
al I
nve
sto
rs L
LC
To
tal E
qu
ity A
ss
ets
25
LogMeIn Inc.58% (29 of 50) of LogMeIn investors are below the priority line of most investment banks.
Market Cap. $1.02 B
© Capital Markets Advisory Partners, LLC26
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
$80,000,000
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
Co
lum
bia
Wa
ng
er A
sse
t Ma
na
ge
me
nt L
LC
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Allia
nz G
lob
al I
nve
sto
rs C
ap
ita
l LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Ch
am
pla
in In
ve
stm
en
t Pa
rtn
ers
LL
C
Fir
st T
rust
Ad
vis
ors
LP
St. D
en
is J
. V
ille
re &
Co
. L
LC
Fro
ntie
r C
ap
ita
l Ma
na
ge
me
nt C
o. L
LC
Cita
de
l Ad
vis
ors
LL
C
Gra
na
ha
n In
ve
stm
en
t Ma
na
ge
me
nt, In
c.
Th
e B
osto
n C
om
pa
ny A
sse
t M
an
ag
em
en
t …
Wa
ll S
tre
et A
sso
cia
tes L
LC
Riv
erb
rid
ge
Pa
rtn
ers
LL
C
Se
ntin
el A
sse
t Ma
na
ge
me
nt, In
c.
MF
S In
ve
stm
en
t M
an
ag
em
en
t, In
c.
Fe
de
rate
d In
ve
stm
en
t M
an
ag
em
en
t Co
.
Lo
rd A
bb
ett &
Co
. L
LC
Ga
gn
on
Se
cu
ritie
s L
LC
We
lch
& F
orb
es L
LC
Ash
ford
Ca
pita
l Ma
na
ge
me
nt, In
c.
Ka
lma
r In
ve
stm
en
ts, In
c.
FIL
In
ve
stm
en
ts In
tern
atio
na
l
We
llin
gto
n M
an
ag
em
en
t Co
. LL
P
Fe
de
rate
d G
lob
al In
ve
stm
en
t …
No
rth
ern
Tru
st C
o. o
f C
on
ne
cticu
t
Dre
yfu
s In
ve
stm
en
t Ad
vis
ors
, In
c.
Sco
ttis
h W
ido
ws In
ve
stm
en
t P
art
ne
rsh
ip L
td.
Ba
nk o
f N
ew
Yo
rk M
ello
n A
sse
t …
We
lls C
ap
ita
l Ma
na
ge
me
nt, In
c.
Pic
tet A
sse
t M
an
ag
em
en
t SA
Oh
io P
ub
lic E
mp
loye
es R
etire
me
nt S
yste
m
En
se
mb
le C
ap
ita
l Ma
na
ge
me
nt L
LC
Inve
sto
r AB
(In
ve
stm
en
t M
an
ag
em
en
t)
Attra
cto
r In
ve
stm
en
t M
an
ag
em
en
t, In
c.
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Co
atu
e M
an
ag
em
en
t LL
C
Ne
w Y
ork
Sta
te C
om
mo
n R
etire
me
nt F
un
d
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Co
rtin
a A
sse
t M
an
ag
em
en
t LL
C
Ab
erd
ee
n A
sse
t Ma
na
ge
me
nt, In
c.
P.A
.W. C
ap
ita
l C
orp
.
Ge
ne
va
Ca
pita
l Ma
na
ge
me
nt L
td.
UB
S O
'Co
nn
or L
LC
Wa
sh
ing
ton
Ca
pita
l Ma
na
ge
me
nt, In
c.
Oxfo
rd A
sse
t M
an
ag
em
en
t LL
P
Willia
m B
lair
& C
o. L
LC
(In
ve
stm
en
t …
Ko
pp
Inve
stm
en
t Ad
vis
ors
LL
C
Esse
x In
ve
stm
en
t M
an
ag
em
en
t Co
. L
LC
Ob
erw
eis
Asse
t M
an
ag
em
en
t, In
c.
Ma
rke
t V
alu
e o
f S
ha
res
He
ld
26
Top 50 fundamental institutional investors ranked by market value of shares held
are mostly smaller investors that are not the focus of large investment banks
Market Cap. $0.66BConstant Contact Inc.
© Capital Markets Advisory Partners, LLC27
$0
$100,000,000,000
$200,000,000,000
$300,000,000,000
$400,000,000,000
$500,000,000,000
$600,000,000,000
Fid
elity
Ma
na
ge
me
nt &
Re
se
arc
h C
o.
Co
lum
bia
Wa
ng
er A
sse
t Ma
na
ge
me
nt L
LC
Wa
dd
ell &
Re
ed
Inve
stm
en
t M
an
ag
em
en
t …
Allia
nz G
lob
al I
nve
sto
rs C
ap
ita
l LL
C
Bla
ckR
ock A
dvis
ors
LL
C
Ch
am
pla
in In
ve
stm
en
t Pa
rtn
ers
LL
C
Fir
st T
rust
Ad
vis
ors
LP
St. D
en
is J
. V
ille
re &
Co
. L
LC
Fro
ntie
r C
ap
ita
l Ma
na
ge
me
nt C
o. L
LC
Cita
de
l Ad
vis
ors
LL
C
Gra
na
ha
n In
ve
stm
en
t Ma
na
ge
me
nt, In
c.
Th
e B
osto
n C
om
pa
ny A
sse
t M
an
ag
em
en
t …
Wa
ll S
tre
et A
sso
cia
tes L
LC
Riv
erb
rid
ge
Pa
rtn
ers
LL
C
Se
ntin
el A
sse
t Ma
na
ge
me
nt, In
c.
MF
S In
ve
stm
en
t M
an
ag
em
en
t, In
c.
Fe
de
rate
d In
ve
stm
en
t M
an
ag
em
en
t Co
.
Lo
rd A
bb
ett &
Co
. L
LC
Ga
gn
on
Se
cu
ritie
s L
LC
We
lch
& F
orb
es L
LC
Ash
ford
Ca
pita
l Ma
na
ge
me
nt, In
c.
Ka
lma
r In
ve
stm
en
ts, In
c.
FIL
In
ve
stm
en
ts In
tern
atio
na
l
We
llin
gto
n M
an
ag
em
en
t Co
. LL
P
Fe
de
rate
d G
lob
al In
ve
stm
en
t …
No
rth
ern
Tru
st C
o. o
f C
on
ne
cticu
t
Dre
yfu
s In
ve
stm
en
t Ad
vis
ors
, In
c.
Sco
ttis
h W
ido
ws In
ve
stm
en
t P
art
ne
rsh
ip L
td.
Ba
nk o
f N
ew
Yo
rk M
ello
n A
sse
t …
We
lls C
ap
ita
l Ma
na
ge
me
nt, In
c.
Pic
tet A
sse
t M
an
ag
em
en
t SA
Oh
io P
ub
lic E
mp
loye
es R
etire
me
nt S
yste
m
En
se
mb
le C
ap
ita
l Ma
na
ge
me
nt L
LC
Inve
sto
r AB
(In
ve
stm
en
t M
an
ag
em
en
t)
Attra
cto
r In
ve
stm
en
t M
an
ag
em
en
t, In
c.
TIA
A-C
RE
F A
sse
t M
an
ag
em
en
t LL
C
Co
atu
e M
an
ag
em
en
t LL
C
Ne
w Y
ork
Sta
te C
om
mo
n R
etire
me
nt F
un
d
No
rge
s B
an
k In
ve
stm
en
t M
an
ag
em
en
t
Co
rtin
a A
sse
t M
an
ag
em
en
t LL
C
Ab
erd
ee
n A
sse
t Ma
na
ge
me
nt, In
c.
P.A
.W. C
ap
ita
l C
orp
.
Ge
ne
va
Ca
pita
l Ma
na
ge
me
nt L
td.
UB
S O
'Co
nn
or L
LC
Wa
sh
ing
ton
Ca
pita
l Ma
na
ge
me
nt, In
c.
Oxfo
rd A
sse
t M
an
ag
em
en
t LL
P
Willia
m B
lair
& C
o. L
LC
(In
ve
stm
en
t …
Ko
pp
Inve
stm
en
t Ad
vis
ors
LL
C
Esse
x In
ve
stm
en
t M
an
ag
em
en
t Co
. L
LC
Ob
erw
eis
Asse
t M
an
ag
em
en
t, In
c.
To
tal E
qu
ity A
ss
ets
27
Constant Contact Inc.68% (34 of 50) of Constant Contact investors are below the priority line of most investment banks.
Market Cap. $0.66 B
© Capital Markets Advisory Partners, LLC
Appendix
28
© Capital Markets Advisory Partners, LLC29
Less than one-third of very small IPOs (< $50 million) are successful in today’s market
Success rate of trailing 30 IPO filings
with proceeds < $50 million
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC30
IPOs that raise $50-$100 million
Success rate of trailing 30 IPO filings
with proceeds of $50-$100 million
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC31
IPOs that raise $100-$250 million
Success rate of trailing 30
IPO filings with proceeds of
$100-$250 million
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC32
IPOs that raise $250-$500 million
Success rate of trailing 30 IPO filings
with proceeds of $250-$500 million
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC33
IPOs that have priced within 1 year of filing—trailing 30 filings
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC34
IPOs that have priced at or above the low end of the range—trailing 30 filings
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC35
IPOs that are trading at or above issue price 30 days after pricing—trailing 30 filings
Source: Capital Markets Advisory Partners, LLC, All rights reserved
Includes only corporate issuers. Excludes funds, MLPs, SPACs and REITs.
© Capital Markets Advisory Partners, LLC36
Capital Markets Advisory Partners
About Capital Markets Advisory Partners, LLC
Capital Markets Advisory Partners is a pioneer in developing
methods to dramatically increase the size and quality of distribution
on IPOs and follow-on offerings. Collectively, we bring hundreds
of years of experience from leading institutions.
Studies authored by two of our principals (David Weild and Edward
Kim) and supported and published by the major accounting, tax
and advisory firm of Grant Thornton have been entered into the
Congressional Record and the Federal Register and our principals
have participated in or testified in front of:
• The NYSE and National Venture Capital Association’s (NVCA)
Blue Ribbon Panel to restore liquidity in the US venture capital
industry (2009)
• The CFTC-SEC Joint Panel on Emerging Regulatory Issues
(2010)
• The House Financial Services Committee’s Subcommittee on
Capital Markets (2011)
• The U.S. Treasury’s Capital Formation Conference (2011).
These studies, supported and published by Grant Thornton, have
been cited by Members of Congress and Regulators in the US and
overseas and by leading publications including, The
Economist, Forbes, The Financial Times, The New York Times and
The Wall Street Journal.
Recently, this work was also cited in:
• The President’s Council on Jobs and Competitiveness (Jobs
Council) Interim Report led by Jeffrey Immelt of General Electric
• The IPO Task Force Report to the US Treasury, led by Kate
Mitchell, past Chairman of the National Venture Capital
Association.
Capital Markets Advisory Partners was founded by David Weild, the
former vice chairman and head of listed companies and related
businesses at NASDAQ and former head of equity capital markets
and corporate finance at Prudential Securities. David also serves as
Chairman of the Small Business Financing Crisis Task Force of the
ISEEE (International Stock Exchange Executives Emeriti).
36
© Capital Markets Advisory Partners, LLC
David Weild
212.542.9979
The IPO Crisis And What Must Be Done To Fix It: Market structure is too low cost to pay for the infrastructure needed to support capital formation.Improved strategies are needed. We offer some.
SoHo Loft
Reed Smith
599 Lexington Avenue
22nd Floor
New York, NY
January 22-23, 2012
![TUNING GUIDE · 1.5º OPEN-0.75º LOFT 56.5º LIE ANGLE-150 RPM UPRT STD LOFT LOWER HIGHER STEP 1 LOFT SLEEVE™ [LOFT, LIE & FACE ANGLE ADJUSTMENT] The 4-degree Loft Sleeve allows](https://img.pdfslide.us/doc/110x75/5e46e418fa93631feb2effdc/tuning-guide-15-open-075-loft-565-lie-angle-150-rpm-uprt-std-loft-lower.jpg)
