Why the IPO market is surging amid COVID-19

Suzanne Shank, President and CEO of Siebert Williams Shank & Co., joins 'Influencers with Andy Serwer' to weigh the reasons why so many IPOs are coming down the pipeline this year.

Video transcript

- IPOs, we've seen this incredible surge this year, even amidst the uncertainty of the pandemic. Why do you think that is?

SUZANNE SHANK: You're so right. The second quarter was the largest quarter I think in 20 years in terms of IPOs proceeds raised and deal count. And much driven by the health care sector and biotech in particular, led the pack. So it's really been the most active we've seen in 20 years. And I think proceeds have reached $80 billion so far this year, surpassing the volume raised in all of last year.

I think low interest rates have pushed up valuations for growth companies and the hundreds of unicorns in the pipeline are looking to take advantage of that. And I think we're seeing companies that both benefited from the pandemic, as well as those that are sort of rebooting post-pandemic. That has really been sparking this increased deal flow. Earlier in the year, inflation concerns had investors worried that the Federal Reserve might change its policy. But after the Fed said that inflation wouldn't change over the long term, it's really been robust IPO time.