How a swarm of initial public offerings could impact the Bay Area

From all the initial public offerings soon to come, the Bay Area is looking at getting a huge influx of thousands of brand spanking new multi-millionaires. For many of the newly super rich, it may be a case of "be careful what you wish for.”

After Lyft's initial public offering on Friday, other household names like Uber, Airbnb, Pinterest, and Postmates are readying their finances to do the same. Business analysts say that could cause as much as a quarter of a trillion dollars in new IPO investments creating from 5,000 to as many as 10,000 brand new Bay Area millionaires.

When it comes to wealth gaps, San Francisco already has the nation's biggest wealth spread. "I think this is an absolutely huge issue for the Bay Area right now. We've always had a chasm between the have and have nots," said consumer psychologist and author Kit Yarrow. 

The Census Bureau says of the city's top 5% of households, earnings average is just over $630,000 compared to $103,000 for average middle-class residents, a far greater gap for the many of lesser means.

"I think we're going to be seeing a lot of transition in the Bay Area and probably a lot of resentment from people who didn't become overnight millionaires," said Yarrow. 

"New offerings are going to create a new generation of relatively young millionaires and we've seen that before and its effect on housing prices," said lawyer, former Wall Street investment banker and Dean Emeritus Golden Gate University School of Business.       

Last year, half of the 2,200 single homes sold in San Francisco were to software employees. That will increase in the city as well as Oakland, San Mateo County and the South Bay.  

Real estate analytics specialist Deniz Kahramaner recently wowed a crowd saying that San Francisco single-family home prices could, on average, climb to as much as $5 million for cash buyers. But fast, big money from lotto, inheritance or IPOs, doesn't necessarily buy happiness. 

"When people get a windfall, it ends up with some sort of dissatisfaction, either the money is blown or they question their relationships or they have a most of, "Is that all it is?" said Yarrow.

Many IPO investors will rob from Peter to pay Paul. "What happens on Wall Street is people sell some of the last round of IPO winners in order to come up with the money to buy in early on the new rounds," said Dean Connelly.

There will be, no doubt, a cultural impact as companies move from free-wheeling to publicly owned and highly regulated companies—a lesson Tesla has learned bitterly.