In a flash, Pure Storage Inc. broke its initial public offering price.
The flash-storage company opened at $16.74 in its debut on the New York Stock Exchange Tuesday, roughly 1.5% below its $17 IPO price. By later morning it was down 4%.
Pure Storage’s debut was highly anticipated by public and private investors as a test of the market’s appetite for tech IPOs. Its $3.1 billion valuation as of Tuesday night when it priced at $17 was perilously close to the $3 billion valuation the company attained in its last private fundraising round in April 2014.
Pure Storage’s open is the latest sign of hot tech startups struggling to top their private valuations when they go public. Few tech companies have even tried this year. Including Pure Storage, just 20 tech startups have gone public, to 62 last year and 48 in 2013, according to Dealogic.
Should Pure Storage continue to struggle in the coming days, tech companies could become even more wary of testing the public markets.
On Tuesday, mobile provider Digicel Group Ltd. said it canceled its planned IPO citing current conditions, particularly in emerging markets.
Earlier this month medical-technology company NovoCure Ltd. came at a price below the valuation at which it last privately raised venture capital from investors.