Gurley explains direct listings guarantee order fills for retail investors while traditional IPOs do not provide such access.
“If you are in a direct listing, any direct listing, and you are at a Schwab account, a Robinhood account, I don't care what, and you put in an order that's a penny higher than the closing price, you get filled. That is not true in a traditional IPO.”
Gurley contrasts direct listings where any retail investor gets filled versus traditional IPOs where retail gets only 5 percent.
“That is not true in a traditional IPO. In fact, retail's often held the 5%,”
Gurley says retail gets only 5% of IPO allocations while handful of top accounts capture $171B transfer.
“So the people that are getting that cheap stock, that 171,000,000,000 of of value transfer is a handful of the best accounts of the best client.”