What Are LUPA Stocks?
LUPA stocks are a nickname for four companies that were born in the mobile app generation. Also referred to as the PAUL stocks, they include Lyft, Uber, Pinterest, and Airbnb. All four companies have completed their initial public offerings (IPOs) and are now actively traded on public stock exchanges.
- LUPA stocks include Lyft, Uber, Pinterest, and Airbnb.
- These stocks were formed during the rise of the app economy.
- All four have completed their IPOs.
- Lyft has the smallest market cap of the four at $20 billion, while Airbnb has the largest at $110 billion.
Understanding LUPA Stocks
The L in LUPA stands for Lyft, the mobile ride-sharing company that emerged as a competitor to Uber in 2012. U stands for Uber, of course, the ubiquitous ride-sharing company that has expanded into other markets. It was founded in 2009. P stands for Pinterest, the web-based photo bulletin board that is also a social network. A stands for Airbnb, the popular short-term rental and experience platform that has revolutionized the travel and lodging industry.
All of these companies emerged as part of the app economy and were funded by venture capital and private equity money. They have become strong brands with wide adoption and consumer loyalty, but profits were elusive (as with most startups). Still, their scale and popularity have enticed public markets and investors, with all four having completed their IPOs in the last few years.
Lyft, the popular ride-sharing app based in San Francisco, was originally founded in 2007 as Bounder Web, Inc. It changed its name to Zimride in 2008 and then to Lyft in 2012. It was founded by entrepreneurs Logan Green and John Zimmer, who are CEO and President of the company.
The company completed its initial public offering (IPO) in March 2019. Its stated mission is "to improve people’s lives with the world’s best transportation." Since its IPO, and as of April 9, 2021, shares have fallen nearly 23%. In terms of market cap, Lyft is the smallest of the four with a market value of $20 billion.
Uber, Lyft's key competitor in the ride-sharing economy, has had a busy decade since it was formed in 2009 as UberCab. The brainchild of entrepreneurs Travis Kalanick and Garrett Camp, the ride-sharing app operates globally and has expanded into other businesses including food delivery, trucking, and scooter rental. Its popularity.
In May 2019, Uber went public. Shares are up over 36% since then, as of April 9, 2021. Now, the company has faced multiple lawsuits and several cities have sharply restricted or moved to ban the service. In 2017, co-founder Kalanick stepped down amid controversy and was replaced by former Expedia CEO Dara Khosrowshahi.
The popular photo-sharing online pin-up board was the vision of entrepreneurs Ben Silbermann, Paul Sciarra and Evan Sharp, who founded the company in 2010.
The company is headquartered in San Francisco but has offices all over the world. Half of its users are outside of the U.S. Pinterest completed its IPO in April 2019. As of April 9, 2021, the company's stock is up almost 20% since then.
The popular peer-to-peer short-term lodging rental platform has disrupted the travel industry in ways its founders may not have imagined when it was launched in 2008. The company also has expanded into tourism services and other ventures. The brainchild of entrepreneurs Brian Chesky, Joe Gebbia and Nathan Blecharzyk, Airbnb has faced pushback in some cities, like New York, that has restricted Airbnb's ability to operate, given intense lobbying efforts from the hotel industry, as well as safety and taxation concerns.
Airbnb completed its IPO in December 2020. Shares are up just around 25% since then, as of April 9, 2021. Airbnb is also the largest company of the four LUPA stocks by market cap—coming in at $110 billion. For context, that's double the market cap of the largest hotel chain operator in the world—Marriott (MAR).
These four companies were some of the biggest unicorns, which are private startup companies with estimated valuations of more than $1 billion. These companies have grown into multi-billion dollar companies.
Investors have shown they are willing to reward other technology-based companies that lose money as they did with Amazon (AMZN) and Netflix (NFLX) in their early days. While the LUPA or PAUL stocks have been able to grow their businesses backed by venture capital and private equity investments, and then cash in on the public markets.