TIME EUROPE
November 27, 2000, Vol. 156 No. 22
TIME FINANCE
Made in Switzerland
Small companies — and savvy investors — are looking to quieter enclaves like SWX New Market for high-tech IPOs
By STEVE ZWICK Cologne
Günter Reichelt's year-old start-up, Evalis AG, is a company with high potential. The Cologne-based firm has developed a nifty product that sorts through a company's incompatible files and unstructured data and snaps them into line so they can be easily analyzed and compared or tied into the firm's website. It's the kind of product that will succeed or fail based in part on how quickly Evalis can grab market share. That in turn depends on how fast the start-up can attract investor euros and embed its product in customer consciousnesses.
A year ago, the obvious place for an ipo for such a firm would seem to be the Neuer Markt of the Deutsche Börse. "Last year, high-tech companies were getting buried in money in the Neuer Markt," says Reichelt. "It didn't matter what you were — a free Internet portal, a web designer — they all got money." Then came the second quarter of 2000, and everything turned. "Suddenly, all high-techs were bad, and all Old Economy companies were good," he says. "There were just too many IPOs for analysts and investors to analyze them all individually." So Reichelt decided to try his luck in little, non-euro Switzerland, where he'd opened a branch office and where his largest investor was based.
Like the Deutsche Börse, the SWX Swiss Exchange had set up a "New Market" segment of its own last year, SWX New Market. It has listed just 17 companies since inception, compared to about 320 on the Deutsche Börse's Neuer Markt. But unlike Germany, where the loosening-up of Deutschland AG had spawned an ipo boom involving many firms that had been in business for decades, almost all of the companies on SWX New Market are life sciences or technology and software operations. Share prices there have increased 57% since January, compared to a loss of 30% for the Neuer Markt.
The SWX Swiss Exchange found Reichelt lawyers to help with a cross-border ipo and banks that specialized in high-tech listings. "It's not the exchange's role to come up with company valuations," says Robert Wyss, who heads SWX New Market. "That's done by the banks that lead the offerings." Agrees Reichelt, "They put us in touch with people at Credit Suisse First Boston who grilled us the way most German bankers never did. They asked more of us, but they offered more as well." He says listing in Switzerland is a way of prequalifying investors: "Our story will be heard by people who understand it, and that's something you can't say about Frankfurt."
That is, if all goes according to plan. Internet money is still tight, and other German companies, particularly biotech firms, are racing to grab the publicity that's sure to accompany the first German ipo on the Neuer Markt's competitor. "We'll certainly have a few German companies next year," says Wyss, "but I can't comment on who it will be." The Deutsche Börse will still have the most sought-after address in the neighborhood, and the overwhelming majority of new listings of German firms will stay in Frankfurt. But for little companies trying to avoid the crowds — and for savvy investors hoping to find Europe's next high-tech winner — it may be worth looking at quieter enclaves for high-tech IPOs.
This edition's table of contents
TIME Europe home
More stories from TIME Europe and related links
E-mail us at mail@timeatlantic.com
Like what you're reading?
Click here to try 4 FREE ISSUES of TIME
|
|
|
|
COVER STORY
Long Wait
There are lessons to be learned by the candidates, the teams and the people as the process goes on and on
EUROPE
Back to the Ballot
Democratic elections show that nationalism is still a powerful force in this divided country
Great Pretender
The election of a one-time royalist in Yugoslavia gives hope to a man whose business card reads "Crown Prince"
Mind Lab
From E-Europe: A Brussels firm helps science and business strike sparks
Welcome to the Content Metropolis
From Fast Forward Europe: How a venerable Hanseatic port shed its Old Economy image to become Germany's hottest city for digital media
MIDDLE EAST
Mubarak's Destiny
Despite some reforms, Egyptian election results warn the President of increasing voter discontent
AFRICA
Damage Control
South Africa's Thabo Mbeki moves to repair damage done by his comments on foreign and domestic issues
Nation Renovation
After years of violence, Somalia is rebuilding itself
TIME FINANCE
Speak No Evil
E.C.B. President Wim Duisenberg has unfairly taken the rap for a weak Euro
When Your Broker Is A Bookie
Something called spread betting is a new kind of investment strategy
Bourse Battles
Vienna's New Europe Exchange challenges Eastern Europe's budding stock markets
Made in Switzerland
Small companies — and savvy investors — are looking to quieter enclaves like SWX New Market for high-tech IPOs
BUSINESS
Not Yet Up to Scratch
A benchmark study shows it's a tough life for start-ups in Europe and governments still have far to go
THE ARTS
Money in his Pockets
A new kind of producer is bringing Wall Street ways to London's theaterland
Wayward Sisters
This year's Booker Prize winner is an intricate mystery that elucidates a nation's recent history
DEPARTMENTS
On Your Own Time
Hong Kong Havens: Where those in the know go to find calm and cuisine in Asia's busiest city
Worldwatch
WHAT DO YOU THINK?
E-mail us at mail@timeatlantic.com
|
|
