Gurley claims legacy IPO process transferred $200 billion over forty years to bank clients, $30 billion last year.
“the legacy IPO process has devolved into this process where a huge one day gains are transferred from the investment banks to their trading clients.”
Gurley presents data showing top-tier investment banks deliver the worst IPO execution over a decade and 100+ IPOs.
“So this is ten years of data, a decade of data over a 100 IPOs, per underwriter. And what you see is astonishing.”
Gurley argues top investment banks deliver worst IPO execution, unlike any other market where quality correlates with performance.
“So it turns out that if you go with the best investment bank, you get the worst execution. And that is that's remarkably odd.”