New breed of IPOs
This is the big-bang week for Massachusetts companies that want to go public.
Four companies hope to raise $568 million or more in initial public offerings scheduled for launch this week. With the exception of one big Boston insurance company spinoff that took place earlier this year, all of the state's other 2006 initial stock offerings combined raised as much as the four state companies on this week's calendar seek from investors.
First up: IPG Photonics Inc. of Oxford expects to raise about $140 million selling stock to underwriters today. It should begin trading publicly tomorrow.
Newstar Financial Inc., a specialty finance company headquartered in Boston, expects its IPO to be priced at the end of business tomorrow. It hopes to raise about $187 million.
Two other companies are on the IPO schedule to be priced Thursday. Double-Take Software Inc. of Southborough expects to raise about $82 million, and Altra Holdings Inc. of Quincy is looking for $160 million.
The sudden flurry of Massachusetts offerings is no isolated incident. This is shaping up to be the most active IPO week of the year nationally, with 22 offerings scheduled. Overall, the stock market has greeted more than 200 new companies with more than $44 billion in 2006, the best year for IPOs since 2000.
But this year's market for new stocks doesn't resemble the IPO environment of 2000 in many ways. Bigger and more seasoned companies are looking for much larger investments. On balance, that's a good thing, considering all the half-baked ideas that passed for new public companies six years ago. But the innovative young companies that used to go public for the money to take the next step up are becoming a rare breed today.
Consider the four local companies looking to go public this week. IPG Photonics, which makes optical fiber lasers, has been around for 16 years. It earned $25 million on revenue of more than $100 million in the first nine months of this year alone. Some of its IPO money will be used to cash out existing investors.
Altra Holdings makes industrial hardware, generating more than $347 million in sales over the first nine months of the year. Most of its IPO money will be used to cash out existing investors.
True, this week's other two Massachusetts new-stock offerings look more like IPOs of old. Double-Take Software is a growing technology company that started making money this year, and Newstar Financial, launched two years ago, has boomed out of the gate.
But they don't have much company on a list of all the smaller and fast-growing Massachusetts businesses that went public this year. Others include two Cambridge companies, Altus Pharmaceuticals Inc. and Metabolix Inc. , plus the star of the state's 2006 IPO crop, Acme Packet Inc. , a Burlington company that makes hardware and software for voice over Internet protocol communications.
LeMaitre Vascular Inc. , a medical device company in Burlington, went public after more than 20 years of private operations, and a few companies launched small stock offerings outside the United States. That's about it.
The list of smaller Massachusetts companies going public doesn't even stand up to last year's crop of local IPOs.
The 2005 roster, though hardly deep, included about a dozen growing companies in software, biotech, drugs, and medical devices. That doesn't count the best-known company in the class, iRobot Corp. of Burlington, or the most successful new stock, VistaPrint Ltd. of Lexington, which has appreciated 171 percent since going public 15 months ago.
The IPO market will look hotter than a pistol this week, but the mood hasn't really changed much. Risk is still out of style, and young companies continue to look elsewhere for their next round of capital.
Steven Syre is a Globe columnist. He can be reached at syre@globe.com. 
