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Illustration: Sarah Grillo/Axios

The IPO market has boomed during the pandemic era, both for real companies and shell companies, reflecting the broader decoupling of the equity economy and real economy.

Reality check: Things could soon change. And fast.

What's happening: Here's the basic flowchart...

  1. Investors have been giving issuers mulligans for recent financial performance. If the first half was strong, great. If it was weak, that's okay too because, you know, COVID. Everyone into the pool.
  2. That added IPO lubricant was based on assumptions that Q2 earnings would be across-the-board awful. But they haven't been, particularly when it comes to technology.
  3. IPO investors now may need to recalibrate. Maybe only those with demonstrated strength deserve to go public. If performance has been weak, it may be more about the issuer than about the virus.

Caveat: I am presuming some semblance of market rationality, without much basis for doing so.

The bottom line: The IPO window opens and shuts without much warning, and it's never a good idea to let your fingers rest on the sill.

Go deeper

How we got here: China pulls plug on Ant IPO

Illustration: Rebecca Zisser / Axios

China is the biggest business story on Election Day in America.

What's happening: The country abruptly pulled the plug on Ant Group's IPO, which was expected to happen Thursday and be the biggest public offering ever.

Dion Rabouin, author of Markets
Nov 4, 2020 - Economy & Business

Ant Group's IPO could be headed for more trouble

Data: Yahoo Finance; Chart: Axios Visuals

China's suspension of Ant Group’s $35 billion IPO is "just the beginning of a renewed campaign by China to rein in the fintech empire controlled by Jack Ma," Bloomberg reported Tuesday.

Details: "Authorities are now setting their sights on Ant’s biggest source of revenue: its credit platforms that funnel loans from banks and other financial institutions to millions of consumers across China," the article noted, citing unnamed sources.

Dan Primack, author of Pro Rata
Nov 4, 2020 - Technology

How Jack Ma scuttled Ant Group’s planned $35 billion IPO

Illustration: Sarah Grillo/Axios

Jack Ma is brilliant. He's innovative. He's one of the world's richest men, and even has a lovely singing voice.

Driving the news: He also made one of the weightiest unforced errors in the history of global business, scuttling what was expected to be a $35 billion IPO for Chinese financial services company Ant Group.