The ride-hailing app Uber was the mother of all tech disruptors. When the service debuted in 2011, it downed the taxi industry in one fell swoop and introduced a whole new gig-economy job: Uber driver.
Uber never had a hard time attracting investors. By late 2018, private investors had poured in enough money to value the company at $76 billion. But as Uber prepared for a 2019 IPO, its top execs had a much higher target figure for the company's stock market debut: $120 billion [source: Isaac, et al.].
At least that's the number that underwriters at big banks like Morgan Stanley and Goldman Sachs told Uber it was worth, which would have made it the largest IPO in Wall Street history. Instead, Uber took home a far more ignominious prize: the record for losing the most money on its IPO [source: Pflanzer].
In the weeks leading up to the May 9 IPO, Uber lowered its expected value from $120 billion down to $100 billion. Then, with days until the IPO, the company proposed a target range of $44 to $50 a share, which valued the company at just $91 billion [source: Isaac, et al.].
By the day of the IPO, investors were rattled by a terrible earnings report from Uber's chief U.S. competitor Lyft, and news of the rise of well-funded ride-hailing companies in Latin America and China. The Friday IPO opened with the stock trading at $45, the low end of what Uber was hoping to get, but instead of rising steadily throughout the day, Uber's stock sunk 6.7 percent by closing.
For investors who had bought Uber stock at $45, they lost a cumulative $655 million in one day, the single biggest dollar loss for an IPO since 1975 [source: Pflanzer]. It also gave Uber a market capitalization of $69 billion, considerably lower than its $120 billion dreams.
In 2022, Uber is still trading in the $40s and riding the ups and downs of the pandemic economy. In November 2021, it announced its first profitable quarter ever, according to Reuters.
Originally Published: Nov 17, 2009