IPO bankers play the waiting game

Our Deal Indicators show that new IPOs commencing decreased by 38% QoQ, and 32% YoY over the 2022 financial year. In short - it’s not a great time to go public.

Renaissance Capital’s IPO Index shows that US IPOs are down 43% year-to-date, with a quarterly performance that has been the ‘slowest second quarter since the Great Recession’. This is a far cry from 2021, where post-COVID demand and appetite for high-growth companies led to a blockbuster year for IPOs.

Recent stock market volatility has made would-be issuers hesitate. Private companies are freezing their initial public offerings because they are concerned about selling shares to a public that is anxiously selling off stocks of all kinds.

While valuations were high during the post-COVID boom of 2021, they have come down drastically. Or as some might say, to more realistic levels - given the current climate.

Special-purpose acquisition companies (SPACs) have also felt the pressure. While SPACs enjoyed a short-lived boom over 2020 and 2021, there are now about 600 SPACs waiting on the sidelines without a shell company to join forces with. It’s expected that roughly half of them will fail to find a target company within their allotted two-year window.
 

Make sense of the evolving market

The Deal Indicators report was created to help our customers benefit from the wealth of data we collect anonymously through our data rooms and platform.
 
We’ve taken tens of thousands of raw, anonymized data points from more than 24,000 deals - including those that are active and ongoing – and ordered them to surface emerging trends across deal types and industries.
 
Most data reports are written after the fact. They tell you what’s already happened, giving you a picture of ‘what was’ and offering little value. Indicators gives us a unique ability to show you the trends six to twelve months before the rest of the market, the average deal taking that long to complete.