Circle IPO Soars 168%, Igniting Hope for Startups Awaiting Public Offering

Circle, a leading issuer of USDC, a stablecoin pegged to the U.S. dollar, saw its shares skyrocket on its first day of trading as a public company. The stock closed at $83.23 per share, marking a 168% increase from its initial public offering (IPO) price of $31 set the previous day.

This impressive IPO pop signals strong investor confidence in cryptocurrencies, particularly stablecoins, especially given the current administration’s favorable stance on crypto assets.

The significant first-day surge in Circle’s stock price may encourage institutional investors to consider higher IPO valuations for upcoming listings. Companies like Omada Health, scheduled to price on Thursday, and fintech giant Klarna, expected to list next week, will be closely watched.

Circle’s IPO initially valued the company at $6.1 billion, a figure lower than its $7.7 billion private market valuation from a 2021 Series F funding round where it raised $400 million, according to PitchBook data. However, the market’s reaction quickly corrected this.

The IPO success significantly boosted Circle’s market capitalization, reaching $16.7 billion by the close of trading (excluding employee options). Furthermore, the company successfully raised approximately $1.1 billion through the offering.

Circle joins a growing list of companies, including Hinge, ServiceTitan, and Reddit, that have recently gone public with IPO prices below their private market highs. Despite this trend, Circle’s successful debut may inspire other startups to consider entering the public market.

This IPO comes three years after Circle’s initial attempt to go public through a SPAC merger in 2022, which valued the company at $9 billion. The current success underscores the evolving market conditions and investor sentiment.

Key stakeholders in Circle include General Catalyst, holding approximately 8.9% of pre-IPO stock, and IDG Capital, owning 8.8% of shares. Other notable venture investors include Accel, Breyer Capital, and Oak Investment Partners, as detailed in their S-1 filing.