Zero. None. Nada... that is how many Tech IPOs there has been in 2016 - the worst start to a year in recent record. Indeed, January marked the first month since September 2011 without an IPO of any kind, according to Renaissance Capital, manager of IPO-focused funds.
It does not look like it is set to get better any time soon either. As Reuters reports, with the battering technology stocks have suffered in the past couple of weeks, and the dismal performance of technology IPOs in the past couple of years, any idea of a springtime busy with technology offerings may also be wishful thinking.
Reuters continues,
Eric Jensen, an IPO attorney for Cooley LLP, said his firm has "a pretty significant pipeline of deals," with about 32 companies that have filed with regulators for IPOs, either confidentially or publicly. But he said plans by the five or so technology firms with a $1 billion-plus valuation in that queue, "are all stalled out."
The cratering in technology stocks has also helped to push down the valuations of private tech companies and interest in investing in them, say capital markets experts. Fewer options for capital raising means that high-flying companies may need to rein in spending, delay some ambitious expansion plans and even lay off staff, according to investors and tech consultants.
"A lot of these companies are going to have to rein in their costs in order to survive," said Matt Brady, co-founder and chief operating officer of investment firm Militello Capital.
"Those that wanted to go out in January, now they're stuck," Jensen said.
"It's quite possible that we will have volatility for the remainder of the year," said Nate Gallon, a partner who leads IPO deals for law firm Hogan Lovells. "People are bracing themselves." Companies face risks if they wait longer than six months between filing for an IPO and listing. Investors can lose interest, management teams can lose momentum and the offering can become anticlimactic, said Karim Anani, IPO west region leader for consulting firm EY.
To be sure, the U.S. stock market could stabilize and recover – it rallied on Friday - and a rebound in technology stock prices would increase the appeal of an IPO for companies like Nutanix. But experts say the number of public tech companies scaling back their revenue growth forecasts, bloated valuations in the private market and concern that the global economy is still on very shaky ground have created roadblocks.