First it was DoorDash Inc. And now it’s Airbnb Inc. In a 24-hour period, the two startups went public and their valuations skyrocketed, a sign that both companies could have raised a lot more money than they did.
Airbnb opened 115% above its initial public offering price, the biggest debut rally on record for a large U.S. listing. Had the shares priced closer to where they started trading — at $146 instead of $68 apiece — Airbnb could have raised $4 billion more for the company and early investors.
That gap is known as money left on the table, and is at the center of a years-long debate about how to price an IPO.