Everpure and Bloom join the S&P 500, the exit after the exit for venture-backed firms
Monday's S&P 500 rebalance moved two former venture darlings into the benchmark and pushed The Trade Desk out. For growth companies, index membership is now the liquidity event that follows the IPO.
Before the opening bell on Monday, September 21, three companies became members of the S&P 500: Everpure, the data storage group known until February as Pure Storage, the fuel cell maker Bloom Energy, and the genomics company Illumina. Three left. The Trade Desk, Builders FirstSource and Molson Coors Beverage were moved down to the S&P SmallCap 600. S&P Dow Jones Indices announced the changes on September 4 and timed them to coincide with its quarterly rebalance.
Index reshuffles are routine, and most investors notice them only as a line in a fund factsheet. This one deserves closer attention. Two of the three additions began life as venture-backed startups, and the stock that left was itself promoted to the benchmark only 14 months ago. Taken together, the moves show how much of a modern growth company's shareholder base is decided not by stock pickers but by a committee's rulebook, and how quickly that verdict can be reversed.
The mechanics of forced buying
The S&P 500 is not a passive list. A committee applies eligibility rules, including a market value threshold that a Webull analysis put at $22.7 billion for this rebalance. Bloomberg reported before the announcement that the rebalance could affect funds tracking nearly $27 trillion, and guests on its ETF programme estimated that 36 companies appeared to qualify for entry. Only three were admitted.
Once a decision is made, a large group of investors has no discretion. Index funds and exchange-traded funds that replicate the benchmark must hold each member at its index weight from the effective date, and must sell departing members by the same deadline. The last session before the change this time fell on Friday, September 18.
The Trade Desk shows what that looks like from the other side. According to a market brief from Pomegra, its shares fell 2.4% to $13.92 on Friday as funds tracking the S&P 500 sold an estimated $680 million of stock, with about 140 million shares changing hands, roughly six times the average daily volume. The advertising technology company's market value had shrunk to about $6.6 billion, far below the entry level for the index it was leaving.
Everpure and Bloom, from venture rounds to the benchmark
For founders and early investors, the more instructive cases are the arrivals. Pure Storage was founded in 2009 and raised more than $470 million of venture capital before selling 25 million shares for $425 million in an initial public offering in October 2015. Bloom Energy, founded in 2001 as Ion America, raised more than $1 billion from venture investors before listing on the New York Stock Exchange in 2018. Each spent years as a listed company before reaching the benchmark.
What finally qualified them was the kind of operating performance that private investors tend to promise and public investors insist on seeing. Everpure, which moved up from the S&P MidCap 400, reported 38% revenue growth in its fiscal second quarter and an operating profit up 77%, and guided to revenue of $5.03 billion to $5.07 billion for the full fiscal year. Webull put its market value at about $33 billion in early September, with the shares having returned nearly 300% over five years. The company holds a financial analyst meeting in Santa Clara today.
Bloom's case rests on demand for on-site power from data centres. Its second-quarter revenue of $1.07 billion was more than double the figure a year earlier, and its shares rose 5.1% to $265.70 in premarket trading on September 8, the first session after the inclusion news, according to a report on Yahoo Finance that also noted a higher UBS price target of $325. The same report described Bloom as the first energy company added to the S&P 500 since 2022, although S&P classifies it in the industrials sector.
Illumina's return is a different kind of story. The company was removed from the benchmark in June 2024, on the day it completed the spin-off of GRAIL. According to TIKR, its shares were up 57% from their 2025 close by mid-September, and it traded at about 38 times trailing earnings.
The Trade Desk and the speed of the round trip
The departure of The Trade Desk is the cautionary half of the rebalance. It joined the S&P 500 on July 18, 2025, replacing ANSYS, and its shares rose nearly 9% to $80.40 on the day the promotion was announced, PPC Land recorded. It spent 430 days in the index.
The decline since then has been driven by fundamentals, not index rules. Second-quarter revenue of $715 million rose only 3%, and guidance for the third quarter implied a fall of about 12%, sending the shares down 24% after hours on August 6. On September 4, the day its removal was announced, the company cut about 575 roles, roughly 15% of its workforce, and its stock closed at $14.43. Index membership did not cause the slide, but it amplified the end of it: the passive holders who arrived as a block in 2025 left as a block on Friday.
A wider shuffle toward technology
The same announcement reshaped the S&P 100, the subset of the largest members. Dell Technologies, Palo Alto Networks, Arista Networks and Sandisk were added, while Honeywell Aerospace, NIKE, Simon Property Group and Colgate-Palmolive were removed. HubSpot entered the S&P MidCap 400. All four S&P 100 additions are information technology companies, and three of the four departures are consumer or real estate names. The direction of travel in the benchmark mirrors where earnings growth has been.
For investors in private technology companies, the reshuffle is a reminder that the public market increasingly delivers its verdict through rules rather than through stock pickers. A company's weight in tens of trillions of dollars of passive portfolios depends on clearing an eligibility bar, and that bar rises with the market.
Our view
Index inclusion has become the second exit for venture-backed companies, and arguably the one that matters more for long-term holders. An IPO creates a market for the shares; admission to the S&P 500 creates a permanent, price-insensitive buyer. Everpure and Bloom earned their places with growth and, in Everpure's case, real operating profit, after years in which public investors were free to doubt them.
The Trade Desk shows that the same machinery runs in reverse, and faster. A growth story that stalls loses its passive sponsorship in one session, at whatever price clears the order book.
Founders planning a listing should treat benchmark eligibility as a design goal from the start: durable profits, a broad free float and a share structure that index providers accept. Investors should watch whether the new members hold their gains once the forced buying is over, and whether Everpure's analyst meeting today supports the valuation that inclusion has helped to set.
Sources
- S&P Dow Jones Indices: Bloom Energy, Illumina, and Everpure set to join S&P 500; others to join S&P 100, S&P MidCap 400, and S&P SmallCap 600
- Crypto Briefing: S&P 500 set to announce rebalancing changes this Friday, putting $27 trillion in motion
- Yahoo Finance: Bloom Energy shares rise after S&P 500 inclusion confirmed
- Webull: Dear Everpure stock fans, mark your calendars for September 21
- TIKR: Illumina stock returns to the S&P 500 after a 57% run
- PPC Land: Trade Desk loses S&P 500 seat the same day 575 jobs end
- Pomegra: Trade Desk stock falls 2.4% on S&P 500 removal
- Wikipedia: Pure Storage
- Wikipedia: Bloom Energy
Filed under Markets. Written by Invest Times Editorial under our editorial standards. Commentary and analysis for information only, not investment advice.
