Why Investors Are Going Gaga Over A Tiny, $35 Computer

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Investors are snapping up the shares of a British maker of tiny computers after it went public on the London Stock Exchange Tuesday.

Raspberry Pi stock soared as much as 40% in early trade before paring those gains slightly by 11.54 a.m. ET to trade at £3.85 ($4.90), still about 38% above their listing price. The initial public offering (IPO) valued the startup at nearly £542 million ($689 million).

These boards, some the size of a credit card, can be connected to bigger devices, such as a desktop screen, or used as components to power machines such as smart speakers and robots.

It sells the rest to education providers and computer science "enthusiasts," according to its website.

In 2022, the University of Cambridge declared one of the company's computers — its cheapest, with a price tag of only $35 — the "best-selling computer to come out of the UK."

The IPO raised £166 million ($211 million), making it Britain's second-biggest this year, according to data provider Dealogic.

Raspberry Pi plans to invest the funds raised in developing its products and expanding its educational activities.