Obviously, we're all aping into this.
But I got curious about a specific question: when SpaceX IPOs, what are the actual odds that Day 1 is the bottom and it never looks back?
Nobody tracks "never traded below IPO price" as a standalone stat. But you can "guess it" from first-day returns, long-run performance, delisting rates, and cohort snapshots. I had AI pull data on 9,343 U.S. IPOs going back to 1980. The answer is about 20–25% of the time. Three out of four IPOs eventually trade below their offering price.
**Day 1**
16.5% of all IPOs close below the offering price on Day 1. Another 13% close flat. Only \~70% finish their first session above the offer.
Post-2001, nearly 24% have negative first-day returns. In 2023 it was 54%.
Average first-day return is 19%. Median is 7%. That gap matters because a small number of blowouts drag the average up. The typical IPO barely clears its offer price.
**It gets worse...**
By year-end, only 23–38% of that year's IPO cohort is still above the offering price (Renaissance Capital data).
Perritt Capital checked 721 IPOs from 2012–2016. At a single snapshot, 58.4% were already below IPO price.
WSJ reported in late 2023 that 80%+ of the \~800 companies that went public since Jan 2020 were underwater.
39% of all IPOs delist within 5 years.
**The odds**
|Time Horizon|Est. % never below IPO price|
|:-|:-|
|Day 1 close|\~70%|
|Within 1 year|30–40%|
|Within 3–5 years|20–30%|
|Full lifetime|<20–25%|
That 20–25% is roughly 1,900–2,300 stocks out of 9,343. Most of them are companies you've never heard of.
**"SpaceX is different"**
It always is. Never bet against Elon, right? Let's take a look:
* **Facebook:** IPO $38 → $17.55 within 4 months (-54%). Led by Zuck, $104B valuation. Didn't reclaim $38 until mid-2013.
* **Netflix:** IPO $15 → $4.85 within 5 months (-68%)
* **Amazon:** IPO $18 → \~$16.75 within a week
* **Tesla:** IPO $17 → \~$15.75 eight days later
* **Apple:** IPO $22 → traded well below during near-bankruptcy
* **Visa:** IPO $44 → $41.78 during Jan 2009 bottom
Billions to Trillions today but they each broke below their IPO price.
But...
* **Google** (IPO $85) — all-time low \~$95.56, never touched $85
* **Microsoft** (IPO $21) — opened at $25.75, never came back
* **Mastercard** (IPO $39) — low in 2008 was still \~3x IPO price
* **Nvidia** (IPO $12) — split-adjusted low held above offer
Broader base rate across all 9,343 IPOs is worse — about 1-in-4.
**The nerds back this up:**
* **Ritter (1991):** 1,526 IPOs. 3-year return 34.5% vs 61.9% for matching firms.
* **Loughran & Ritter (1995):** 4,753 IPOs. 5-year return 15.7% vs 66.4% for matches.
* **Ritter & Welch (2002):** Average market-adjusted 3-year return: -23.4%.
* **Dimensional (1991–2018):** 6,362 IPOs. 6.93% annualized vs 9.13% for Russell 3000.
* **Siegel (Wharton):** \~9,000 IPOs. 4 out of 5 underperformed a small-cap index.
Return distribution is heavily right-skewed. Top 10% earn 300%+ and pull up the average. Median IPO produces negative returns.
**Bigger pop, bigger drop**
The eras with the biggest Day 1 returns produced the worst long-run performance.
|Era|Avg. Day 1|Long-Run Outcome|
|:-|:-|:-|
|1980s|7.2%|Moderate underperformance (Should have bought SPY)|
|1999–2000|64.6%|Catastrophic (Rekt)|
|2020–2021|36.5%|Severe losses (Cooked)|
|SPACs (2021)|N/A|\-64.2% in year one (Chamath'd)|
193 IPOs doubled on Day 1 during the dot-com bubble. $66.8B left on the table. Most of those companies don't exist anymore.
**The bigger the pump, the bigger the dump.**
The pop isn't for you. That 19% average Day 1 return represents \~$250B in value that went to institutional clients of the underwriters. By the time you degens can buy, it's priced in.
Lockup expirations. 90–180 days post-IPO, insiders sell for the first time. Research shows \~-2% abnormal returns around lockup expiry. Uber dropped 17%. DraftKings fell 44%. When SpaceX insiders can finally cash out, that's a wall of supply. In simpler terms, Chamath is going to dump his bags onto you and then buy a Global 8000, while you eat ramen.
**TL;DR: Data says we're probably cooked - but fuck it, all in.**
**Sources:** Ritter IPO database (UFL), Renaissance Capital, Ritter (1991) Journal of Finance, Loughran & Ritter (1995), Ritter & Welch (2002) NBER WP 8805, Dimensional Fund Advisors, Gahng/Ritter/Zhang (2023) Rev. Financial Studies, Perritt Capital, Bradley/Jordan/Ritter (2003).