Yesterday LinkedIn (LNKD) debuted at a public company. The IPO was priced at $45.00 per share, opened at $83.00 and traded over $122.00 before closing around $94.00. This is all pretty familiar to me as I was a witness to the Internet Bubble. The late 1990’s was a time when companies that basically had a plan and a website went public and easily doubled on the first day of trading. Now that LinkedIn has done so, Facebook, Twitter, Groupon, and Zynga are sure to follow.
Will the result be an equity market bubble and subsequent bubble burst like we had a little over 10 years ago?
One argument is that there is a difference between the crazed mania surrounding IPOs ten years ago and what occurred yesterday. Specifically that there is a bit more history and maturity associated with LinkedIn and the other Internet related companies that may make the transition to public companies in the next few months. I always cringe when I hear “This time it’s different” before an explanation regarding the markets. Only time will tell if it truly is different this time around.