Where Has the IPO Lockup Gone? Tech Firms Trim Them Back

Some of last year’s most valuable tech initial public offerings, including Airbnb, Doordash and Snowflake, allowed pre-IPO shareholders to sell their stock before the traditional six-month waiting period expired. A more recent crop of listings, as well as Robinhood's imminent IPO, show the shift away from rigid lockups not only has continued but has become the norm.

Of the 15 largest 2021 tech IPOs based on valuation, nine abandoned the traditional restriction on selling shares for the first six months. Instead, they offer employees and early shareholders opportunities to sell earlier at various points, such as once the stock price hits a certain level. The companies providing these early exits include Affirm, Coupang, UiPath and Confluent.

The group also includes stock-trading app Robinhood, which is expected to go public in the coming days, and which will let employees sell up to 15% of their shares immediately and another 15% of shares three months later.