Could we interest you in $675bn in tech stocks?
The Unhedged podcast discusses the surge in tech IPOs and stock market listings, with Goldman Sachs projecting $675 billion in total new equity volume for the year. Hosts Katie Martin and Rob Armstrong examine upcoming listings from AI giants like Anthropic, OpenAI, and SpaceX, while debating whether this frenzy signals a golden opportunity or echoes the dot-com bubble of 2000.
Summary
The episode opens by framing the current IPO market as a 'feeding frenzy,' noting that 40 US deals worth $28 billion have already hit the market by end of May 2025 — the highest tally since the banner year of 2021. Goldman Sachs projects $225 billion in new IPO volume and up to $675 billion when including follow-on issuances and secondary offerings, against a total US stock market cap of roughly $75 trillion.
The hosts focus on three major upcoming AI-related listings: Anthropic (which filed paperwork for a $1 trillion+ valuation IPO), SpaceX (valued at $1.75 trillion but only listing $75 billion worth, or about 4% of itself), and OpenAI. They note that these companies have remained private far longer than previous generations of tech firms, raising questions about how much value has already been extracted by private investors before public markets get access.
Alphabet (Google's parent) also draws attention for announcing an $80 billion secondary stock offering despite already being a $4+ trillion company. The hosts argue this is rational given the stock's near-doubling since March 2025, allowing the company to raise cheap equity capital to fund its massive data center buildout. However, the stock dropped roughly 2.5% on the news, suggesting markets are sensitive to dilution even at these levels.
The dot-com bubble parallel is discussed at length. Katie raises the concern that heavy IPO activity historically coincides with market tops, while Rob pushes back by noting that unlike Pets.com or Webvan, today's AI companies have demonstrated real and rapidly growing revenues. However, both acknowledge open questions about AI business model sustainability, pricing power once discounts end, and how commoditized AI services may become.
A structural risk highlighted is the expiration of insider lock-up periods. Goldman Sachs estimates an additional $500 billion in shares could hit the market as lock-ups expire, mirroring a dynamic that coincided with the dot-com crash. Rob argues that insider selling doesn't necessarily signal bearishness — wealthy early employees may simply be diversifying — while Katie maintains it warrants scrutiny.
Rob's broader macro concern is the growing divergence between a weakening consumer economy (with real income growth near zero or slightly negative) and a booming technology investment cycle, warning this imbalance resembles China's investment-driven growth model, which carries its own risks. Both hosts conclude that animal spirits are strong, the market will likely absorb the new supply, but fragility is building and the situation warrants close monitoring.
Key Insights
- Goldman Sachs projects $675 billion in total new US equity issuance for 2025, including $225 billion in IPOs alone, with Anthropic, OpenAI, and SpaceX each expected to list at $1 trillion+ valuations.
- Rob Armstrong argues that unlike the dot-com era, today's AI IPO wave is underpinned by real, rapidly growing revenues — citing Anthropic's billion-dollar revenue growth — making the bubble comparison less straightforward.
- Katie Martin highlights that SpaceX is only listing 4% of itself, and Goldman Sachs estimates an additional $500 billion in shares could flood the market as insider lock-up periods expire, a dynamic that historically coincided with the dot-com crash.
- Alphabet's $80 billion secondary offering caused its stock to drop ~2.5%, which the hosts interpret as the market signaling that equity supply is not infinite and shareholder dilution — even below 2% — generates pushback at current valuations.
- Rob Armstrong warns of a macroeconomic tension where the US consumer economy is weakening with real income growth near zero or negative, while technology investment is booming — a divergence he compares to China's investment-driven growth model and its associated instabilities.
Topics
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