Twitter IPO: Way ahead for Tech start-ups

When market bell for Twitter (NYSE:TWTR) rang on November 7, 2013, it was a booming start.  It opened at $45.10 and closed at $44.90. This was approximately 73% upside of IPO price i.e. $26.

Twitter was another hot tech IPO and controversial too.  Although pricing of TWTR was not done on aggressive side, still market participants were sceptical over the move ahead. Thanks to the lesson that twitter learned from facebook's IPO.  Facebook which drumbled for many days, up-to now TWTR is going in a steady way.

But the discussion can not be completed with-out talking about the possible tech boomers which are in line for IPO.  Dropbox, Square, Snapchat, Pinterest, Uber, Box, Scribd, Flipboard are just to name a few.  Snapchat was recently in news for rejecting the facebook's offer of $3 billion.  Although most of tech startups, including Twitter is not profitable yet, still the craze that market makes on them gives them insane valuations.

Venture capitalists are putting huge money in these start-ups.  Pinterest, for say, raised $225 million recently and was valued at $4 billion. Company has recently started genrating revenue, so being profitable is a long term story.  Although twitter IPO has proved that being profitable is an irrelevant thing in valuation space, although it adds a value.  Moreover, theorists also configure on this point as valuation at any point of time depends on your all future cash flows, not just whether you are currently profitable and earning money or not.

But this tech bubble should stop some-where. This tech bubble should not repeat the insane valuations of the era of dot-com bubble.  Theorists and analysts have to converge somewhere and that should be a balancing boundary-line between value and bubble.   

VEEVA : A cloud opportunity Gained

With in a span of six years if you reach $5 billion valuation !!!! Its Huge....

Veeva Systems was founded in 2007.  It provides enterprise level cloud based solutions to life-science

companies.  Till Tuesday October 15' 2013 Veeva Systems had raised $7 million out of which $4 million came from Emergence Capital Partners.  Came Wednesday and they flaunted the markets and analysts by raising $261 million. 

Veeva was first supposed to come up at a price of $12 to $14. They increased it to $16 to $18 one week prior to IPO, but finally came up at $20. And the story of uprising doesn't ends here. The stock price raised to almost double on first day of trading. It reached an intra-day high of $39.64. 

Now the question of the day is why so much fuss? The answer is - Its not fuss but Cloud services is the future of tomorrow.  Whenever you check your mail via Gmail or upload a video on youtube or share your latest snap on facebook....you are using cloud. But the future is more bigger than this. From production systems and workloads, creating testing scenarios for complex systems cloud is every where to full fill business needs. 

As per a latest report @Gartner, cloud services market is expected to reach $131 billion by end of 2013. Most of this market approximately 59% is concentrated in North America and cloud advertising is the largest sub-segment of Cloud services. 

Veeva is just an opportunity gained. They provide cloud based enterprise solutions to life science industry. As life science companies mostly has a very long gestation period. So they need a large ...very large amount of data and solutions for sustaining.