The large IPO of South Korea-based e-marketplace Coupang took place last week and UK-based Global E also filed to go public. We had not seen as many IPOs of companies from this space before. However, with the boost from the pandemic and frothy public markets, we may see more going forward.

The e-commerce space was given enormous boost by the covid-19 pandemic and stay-at-home orders around the globe. Many observers of the sector have ventured to say that the pandemic has greatly accelerated consumer’s adoption of e-commerce platforms, which had already been on the rise in previous years. With these developments as a backdrop and a raging bull market, it is not surprising that promising businesses in the sector may seek to go public.

Coupang, a South Korea-headquartered online marketplace backed by telecoms and internet group SoftBank, floated on the New York Stock Exchange in an upsized $4.55bn IPO last week. The company priced 130 million shares at $35.00 each. It had set a price range of $32 to $34 for 120 million shares, 100 million of which were set to be issued by the company and 20 million sold by its investors. SoftBank had committed $1bn in 2015 in return for a 20% stake, before providing a further $2bn three years later.

Launched in 2010, Coupang operates an e-commerce platform that offers a wide range of consumer goods through a same-day delivery service. The company increased its annual revenue 91% to almost $12bn in 2020 and reduced its net loss substantially from $699m to $475m.

It does not seem like Coupang will be the only corporate-backed e-commerce business to jump on the IPO bandwagon. UK-based Global-E Online also filed to raise up to $100m in an IPO. The transaction would enable postal service Deutsche Post to exit.

Global-E’s online platform allows local merchants to sell goods to customers internationally without friction, using tools that convert prices and information into local languages in addition to payment options that suit the market of the buyer. Global-E managed to turn a $7.5m net loss from 2019 into a $7.9m net profit in 2020, while more than doubling its revenue to $137m.

While there have been exits from corporate-backed companies in the e-commerce space, especially in recent years, as the GCV Analytics bar chart below shows, the IPOs have been rather few and far between. This, however, may change in the short run, as e-commerce businesses have been given a substantial boost and public markets have gathered upward momentum.