ANALYSIS: AI Fuels Silicon Valley 150’s IPO Newcomers

Four initial public offerings made 2025’s Fenwick–Bloomberg Law SV 150 List of largest Silicon Valley public technology and life sciences companies. Although that represents only a small percentage (less than 2.7%) of the list, it is nonetheless twice the tally recorded for each of the prior two years’ lists.

IPOs fared much better on the SV 150 lists for 2019, 2020, and 2021, with 11 making the SV 150 in 2019, nine in 2020, and an incredible 23 companies securing their place on the list during the height of the pandemic bull market in 2021. (The SV 150s are based on the previous year’s revenue.)

IPO Count Up; SV 150 IPOs Still Down

The number of non-SPAC IPOs in the US has returned to pre-pandemic levels, yet the number of IPOs in this year’s SV 150 list doesn’t reflect that.

There were 195 traditional IPOs in 2024—four more than 2019. Curiously, the four IPOs in 2024 that made the SV 150 (Reddit, Rubrik, Astera Labs, and Life360) are only 36% of 2019’s total of 11 IPO companies making the list that year, despite the bounceback of the market overall in 2024.

No Tech Sector Commonality but AI Is a Driving Force

Last year, we looked at the mix of newly public companies making the SV 150 list. Although there are twice as many IPOs (4) making the list as there were last year (2), the companies each come from different industry sectors with their own reasons for going public.

That makes it appear that these companies, albeit all technology companies of some type, have little in common. However, a deeper look reveals that all four IPOs are artificial intelligence plays, boosting the companies’ interest among investors looking to get in on the AI revolution.

Reddit Finally Goes Public

Reddit went public about a decade after comparable large social media peers did, including Meta Platforms which became a public company back in 2012, X (formerly Twitter) in 2013, and Snap (formerly Snapchat) in 2017. Reddit confidentially filed its IPO with the SEC in 2021, but market conditions and other reasons kept the company from completing its IPO until March 2024.

Since Reddit’s debut, the stock has been strong, closing at $144.85 on July 29, almost 4.3 times its IPO price of $34 per share. A big part of Reddit’s rise has been the exclusive data from its over 100 million unique daily users that the company licenses to train AI models. Reddit outperformed Meta in 2024, a company which has also been making a huge play in AI. Reddit’s 52-week high is over $230 a share.

A less positive consequence of AI for Reddit is a recent shareholder lawsuit alleging that Reddit’s board and company executives misled investors about how Google Search’s algorithm and AI updates would affect the platform’s social media traffic. Traffic concerns have caused analyst downgrades and have negatively affected the company’s stock price.

Rubrik’s Momentum Building Since IPO

Rubrik, a Microsoft-backed startup that applies AI and machine learning to business data, finished its first day of trading up 16%, a fairly modest price pop above its $32 a share IPO price. The company has since become a favorite among analysts, with the stock trading at a premium compared to its cybersecurity competitors. The stock closed at $89.22 a share on July 29, an almost 179% increase.

At the end of June, Rubrik announced that it would acquire Prednibase, a startup that aids in adjusting open source AI models.

AI Powers Astera, Shares Up Fourfold

Analyst favorite Astera Labs, an AI-focused chip connectivity company backed by Intel, priced its IPO shares at $36. Shares quickly went up to $72 on its first day and hit a 52-week high of $147.39 on Jan. 6.

Along with Reddit, Astera was one of the top performing newly public companies among those that debuted on US exchanges from January 2022 to early November 2024, with strong AI demand pushing these stocks higher. Astera closed at $118.41 on July 29.

Life360 Locates People, Pets and an AI Acquisition

Life360, a company which helps people to track the location of pets, other people, and things, had a bumpy start to its $27 a share US IPO (it debuted in Australia in 2019). Its shares went down initially but have rebounded well, closing at $75.90 on July 29. In a quarterly SEC filing, Life360 claimed to have approximately 83.7 million monthly active users as of March 31.

The company, which already uses AI in some of its offerings, gave itself a boost to its AI-powered targeted advertising capabilities when it acquired a unit of Fantix Inc. in February.

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In other analysis articles covering the results of the 2025 Fenwick–Bloomberg Law SV 150 List:

• Boebin Park spotlights the top 10 companies on this year’s list, including their M&A activity over the past year.
• Kafui Quashigah explores the growing impact SV 150 members are having in the syndicated lending markets.
• Stephanie-Solange Campbell introduces the 14 Silicon Valley companies that are new arrivals to the 2025 list.
  

Bloomberg Law subscribers can find related content on our Equity Deal Analytics page and on our Securities Practice Center resource.

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