• Capital access and efficiency — A critical benefit of this liquidity is that public markets can provide much greater amounts of capital at lower costs than private markets and with less friction.
• Brand — Few events in the life of a company offer the level of brand recognition and trust that becoming publicly traded does. When a company is public, its business metrics are accessible to everyone and there is much greater transparency. This openness can foster customer trust and enhance the company’s public brand among retail investors.

While companies may continue to stay private longer, we believe leading companies will not remain private forever. The trend of extended private ownership allows private-market investors to benefit from higher growth profiles, sector diversification, and value creation potentially unavailable in public markets. However, we believe the IPO’s significant value proposition remains strongly intact.

So, IPOs are not dead, in our view, but it’s critical for investors and companies to understand the dynamics driving their long and misleading nap. By addressing these issues, stakeholders can better navigate the complexities of IPOs, prepare for a smoother transition from public to private, and capitalize on opportunities in both private and public markets.

1“IPO trends: First half of 2024 and beyond,” Stout, 26 August 2024.(go back)