How to Trade the Biggest Software IPO in History

Yesterday marked the biggest software initial public offering (IPO) in history.

Snowflake Inc. (NYSE: SNOW), a cloud-based startup funded by big names like Salesforce and Berkshire Hathaway, hit the market Tuesday night with a $120 per share price tag.

By Wednesday afternoon, the stock had shot above $300 for a 150%-plus gain in just one day.

From the IPO, SNOW sold a whopping 28 million shares and raised almost $3.4 billion. Today, it’s valued at $70 billion – topping long-time established companies like Walgreens Boots Alliance Inc. (NASDAQ: WBA) and Allstate Corp. (NYSE: ALL), to name a few.

It’s safe to say that this stock is hot. But I’m not throwing my money in just yet – and you shouldn’t either.

I’ve never been too keen on trading IPOs. You never know what’s going to happen. The company could double in one day like SNOW, sure. It could even rocket 163% its first day like Beyond Meat Inc. (NASDAQ: BYND).

But it could also crash and burn like Lyft Inc. (NASDAQ: LYFT), which fell over 27% less than one month after its IPO. Sitting at about $30 today, LYFT shares have yet to climb back to their $72 IPO price.

Or it could meet the same fate as LYFT’s biggest competitor, Uber Technologies Inc. (NASDAQ: UBER). The ride-sharing company scored a valuation above $80 billion, only to be worth less than $50 million just five months later.

It’s easy to get caught up in the excitement of an IPO like SNOW’s. 105% in a single day? That number would sound attractive to any investor or trader I know. But the bottom line is that we have no idea where the stock will go from here.

The best indicator of the future is the past. But SNOW just joined the stock market yesterday – meaning there isn’t a past to look at.

My advice when it comes to IPOs?

Wait. Sometimes, doing nothing is the best thing you can do.

Unless, of course, you can get in pre-IPO.

Now, I’m not the first person you should go to when it comes to learning about angel investing.

But this guy is.

His name is David Weisburd. He’s only 34 years old, and he’s already worth millions thanks to his portfolio’s 95% success rate. And today, he’s showcasing six new startups he’s investing in – and recommending.

The potential behind these companies completely dwarfs SNOW’s IPO success. David thinks they could 100X their valuations in the next few years – and he’s one of Silicon Valley’s most successful venture capitalists.

In this video, he’ll show you exactly how to secure a stake alongside him in these early-stage opportunities.

If you choose to put these companies in your portfolio, I doubt you’ll want to give Snowflake’s IPO a second look.

To your success,

Tom Gentile

Leave a Comment

View this page online: