Snap Chart
Despite the storied stock successes of technology icons such as Amazon and Google, most initial public offerings (IPOs) have burned investors. New Bain & Company analysis shows that over five years, two-thirds of global IPOs underperformed their established, publicly listed peers, with a median 46 percentage points lower total shareholder return (TSR). The elite companies that manage to outperform their public peers in TSR do three things differently. They view the IPO as a beginning and a means to a longer-term value creation, rather than any kind of end in itself. They understand how post-IPO investors have fundamentally different objectives and incentives. And they emphasize strategic support to help build that long-term value, rather than simply seeking transactional help. Executives who have prepared for life beyond the IPO position their companies to earn investors’ trust.
Hubert Shen is a partner with Bain & Company’s Mergers & Acquisitions and Private Equity practices. Henrik Poppe leads the Corporate Finance practice in Europe, the Middle East and Africa. Mike Kuehnel is a partner with Bain’s Financial Services and Corporate Strategy practices. They are based, respectively, in Los Angeles, Oslo and Frankfurt.
![](/contentassets/93cc7af18a8342a5996aab480a1321ed/reversing-the-winners-curse-of-the-ipo-1_1.jpg?width=768&height=768&mode=crop)
Reversing the Winner’s Curse of the IPO
Congratulations, you’ve sold shares to the public. Now what?