According to Bloomberg data, last week represented the most active period for IPOs in the U.S. and Europe since September, with a total of $5.5 billion raised. IPOs included Reddit, Astera Labs and Swiss company Galderma Group, which saw strong investor demand, leading to a sharp rise in their share prices.

Reddit saw a 48% increase last week Thursday, despite the company's decision to set the price at the high end of its proposed range. Galderma, which was Europe's largest IPO since 2022, ended the first day up roughly 20%, and Astera Labs also saw impressive growth, with its stock price climbing from $36 to $70 per share in just three trading sessions.

Reddit's appeal lies in its use of artificial intelligence through a partnership with Google, which will gain access to Reddit's data API, allowing it to use Reddit's real-time content to train AI models. In return, Reddit will gain access to the Vertex AI service and also open up revenue opportunities through licensing arrangements. Astera Labs is focused on developing products that facilitate the integration of AI and machine learning into cloud systems, and last but not least, Galderma's success can be attributed to its strong position in the emerging dermatology market.

By contrast, the Douglas IPO, backed by CVC Capital Markets, has not had such a strong start. The Frankfurt offering, which was priced at the lower end of the price range, saw the shares plunge. Despite raising EUR 850 million in the IPO and receiving a capital injection of EUR 300 million from existing shareholders, including private equity group CVC and the founding Kreke family, Douglas ended the first day down almost 12%.