Forget SpaceX, here are the worst IPOs of all time

A month on from its much-vaunted IPO, SpaceX (NASDAQ: SPCX) has crashed back down to earth. 

The space exploration company, which also owns X (formerly Twitter) and xAI, briefly helped make Elon Musk the world's first trillionaire when it surged to a US$2.6 trillion valuation a few days after its June debut. 

From a listing price of US$135, the stock briefly jumped above US$200, giving the investors that were game enough to buy in the chance to exit for a healthy profit. 

Things have since taken a turn for the worse, and the stock has been trending downward ever since. It now sits around US$123 per share, below the US$135 IPO price. 

For a company that generates US$18 billion in yearly revenue, a multi-trillion-dollar valuation was always going to be difficult to maintain, especially given the large share unlocks that are scheduled to begin in August. Those who didn't sell may soon be on the receiving end of even bigger paper losses. 

From that early high, the stock has now dropped 39% and wiped roughly US$1 trillion from SpaceX's market cap. In raw number terms, it's unlikely any IPO will match that amount of value destruction in such a short space of time. 

But it's far from the worst IPO in history. Here are some from the ASX and the US stock market that truly deserve that title. 

1.  Pets.com (NASDAQ: IPET)

No company better encapsulated the exuberance of the Dot-com bubble than Pets.com. It boasted a ".com" company name, a marketing-first strategy and a shaky business model that looked to jump on the burgeoning e-commerce industry but was losing money on every sale.  

In its first financial year, the company made US$619,000 in revenue and spent US$11.8 million on advertising, which included a Super Bowl ad and a sock puppet mascot that became a minor celebrity. 

The company went public in 2000 at the peak of the bubble, raising US$82.5 million at a share price of US$11 and reaching a peak market capitalisation of US$400 million. 

Over the next nine months, the share price crashed from US$11 to US$0.19 on the day the company announced it was going into liquidation, a 98% fall from the IPO. 

2. DiDi Global (NYSE: DIDIY)

Chinese rideshare and transportation company DiDi remains one of the world's biggest companies, with over 550 million users and US$21 billion in annual revenue.

But its life as a publicly traded company proved far more ignoble. 

After global expansion and large investments from SoftBank, DiDi Global listed on the New York Stock Exchange in June 2021. 

It raised an impressive $US4.4 billion at a share price of US$14 and a US$70 billion valuation, but well below the US$10 billion raise initially targeted by the company. 

However, an order from the Chinese government's Cyberspace Administration of China (CAC) in July 2021 forced Chinese app stores to remove DiDi due to alleged violations related to its collection of personal data. 

In December 2021, the company announced it would be delisting from the NYSE and relisting in Hong Kong, but this was also blocked by the CAC, causing the DIDIY share price to fall 44%. 

The company did finally delist from the NYSE in June 2022, and DIDIY shares can now only be traded on over-the-counter (OTC) exchanges, where they are currently priced at US$3.53 a share, 75% below the IPO price.

3. Funko Inc (NASDAQ: FNKO)

Collectibles manufacturer Funko makes this list as the stock with the worst first-day return of any IPO in recent history. The company listed on the Nasdaq in November 2017, raising US$125 million at an initial share price of US$12. 

But scrutiny over its reported income figures and a huge debt obligation to its private-equity owners saw the stock crash a staggering 41% on its first day of trading, wiping out more than US$200 million of value. 

Unlike most of the stocks on this list, however, IPO investors in Funko have been given plenty of opportunities to sell at a profit. The stock reached a record high of US$28.85 in 2018, before dropping to US$3.18 during the Covid crash of March 2020.

It then recovered to above US$20 a share, but has been sold off in recent years and is now trading at US$5.81.

The ASX's worst IPOs

1. Zebit Inc (ASX: ZBT)

The Buy Now Pay Later sector has produced many of the ASX's notable recent IPO failures, but it's arguably Zebit that earns the mantle as the worst of the lot. 

The US-based BNPL and e-commerce provider offered "interest-free" financing to American consumers with poor credit scores and listed on the ASX in October 2020. 

It raised $35 million at an IPO price of $1.58 per share, giving the company a market cap of $149 million. But huge losses and bad debts saw the stock drop 34% on its first day of trading.

Within two years, it had plummeted to $0.043 a share, a drop of 97%, and was delisted from the ASX.

2. Nuix Ltd (ASX: NXL)

Unlike the other companies on this list, Nuix is still in business and publicly listed, but has still been a fairly miserable investment for those who bought at the IPO. 

The data analytics company was incorporated in 2005, but only listed on the ASX in December 2020 at an IPO price of $5.31 per share and a $1.8 billion valuation. 

The stock did briefly hit $11 a share in early 2021, but by September 2022 had fallen to $0.55 a share due to an AFP investigation into alleged insider trading, which led to the removal of key executives. This represented a 95% fall from its record high, and 90% from its IPO price.

The stock did rally in 2024, briefly surpassing $7.70 before falling again to well below the IPO price. It currently trades at $1.27 a share, 76% below its listing price. 

3. Adore Beauty (ASX: ABY)

Another casualty of the Covid-era IPO listing mania, online beauty retailer Adore Beauty listed in October 2020, raising $250 million at a price of $6.75 and a market cap of $635 million. 

Founded in 1999, the company enjoyed two decades of solid growth before its 2020 listing, when it was riding high on pandemic-driven consumer spending. 

But a combination of an overpriced IPO valuation, and subsequent profit margin compression and increased competition, has seen it tumble to a record low of $0.275, after a substantial selloff in 2022 saw the share price fall from $5.25 to little over $1 in less than 12 months.

At current prices, it has managed a 96% fall from its initial listing price. 

IP-Oh no

So while it's been an unconvincing start for SpaceX, history is littered with examples of IPOs that went disastrously wrong for investors. 

Have you had any IPO investments blow up in your face? Let us know in the comments below.