“If, as President George W. Bush suggests, this post-boom period
is like a collective hangover for investors, then they can look
back on the Linux IPO mania as the last drink they consumed before
passing out.“It started when Red Hat went public on Aug. 11, 1999, priced at
$14 per share. It closed that day at $52.06, and that was only the
beginning. The stock soon soared so high it split two-for-one, a
spectacular performance that made Red Hat Chief Executive Matthew
Szulik nervous. He knew it couldn’t last. ‘The day our stock hit
$300 was one of the worst days of my career,’ he says. ‘It was a
totally unrealistic share price.’“Not by the go-go standards of 1999, when tech stocks were in
frenzy mode and nothing was hotter than a Linux IPO. Cobalt
Networks came out in November, followed in December by Andover.net
and then the big one–VA Linux. VA gained almost 700% on its first
day of trading, making it the biggest-popping IPO in history. But
Caldera Systems failed to match VA’s performance when it went
public in March 2000, which turned out to be an omen because that
was the month the tech bubble finally burst…”