Christmas came a few days early for Silicon Valley and one of its leading venture investors, Bill Gurley. The U.S. Securities and Exchange Commission on Tuesday greenlit new rules that will allow companies to raise capital through direct listings of their stock, a change that could provide a more appealing alternative to the traditional initial public offering process. (Our own reporter Ross Matican recently predicted such changes would happen in the coming year.)
No one has clamored more loudly for a shakeup of that process over the last several years than Gurley. He has argued that the big pop in share prices that often accompanies the hottest IPOs has cheated startups out of billions of dollars in capital, putting those gains instead into the pockets of mutual funds and other favorite clients of investment banks.