Recent headlines are drawing attention to the “IPO drought”, with US IPOs down 80% year on year. With these declines in public markets, particularly for tech stocks, companies looking for liquidity must quickly change their plans to adapt to the new climate that’s mirroring the dot-com bubble burst.
IPOs are generally attractive for companies as a liquidity event for shareholders. This offers the prestige that comes with listing publicly, plus gives companies access to new sources of capital. Without the prospect of IPO as a liquidity event and the significant cost of listing, businesses are getting more creative.
As private markets were historically closed to many investors, the opportunities on offer were out of reach to nearly all investors. However, technology has made transacting on private companies as simple as trading on the stock market.
PrimaryMarkets provide a private trading platform that offers the ability for private companies to access fresh capital opportunities from its database of active sophisticated investors.
Companies can increasingly find those same benefits by remaining private and leveraging that technology to deliver liquidity and benefit from promotion to over 110,000+ global investors.
For companies, they get the added benefit of reduced costs and administration that comes with a public listing, while still gaining access to many of the same benefits.