Tech sector IPOs are off to their slowest start since 2009, according to Dealogic data.
It’s because some big-name startups are holding off on public offerings, preferring to instead raise big bucks through private financing rounds.
Data from Dealogic shows a total of about $US2.35 billion in tech IPOs so far this year, on a paltry 8 deals. That’s the least the tech sector has produced since 2009. Just 15 IPOs all year produced $US3.9 billion in deal value, so far this year.
Last year, 62 tech IPOs generated a whopping $US40.845 billion in deal value, Dealogic data said.
Bankers are blaming private markets. Late stage private companies, including Uber and Spotify, have been able to raise IPO-like amounts of capital from investors that previously tended to buy in at the time of an IPO, and not before. This includes T. Rowe Price and Fidelity Investments.
“None of those companies are in a rush to go public,” said Elgin Thompson, managing director with Digital Capital Advisors in New York. “The floodgates are not going to open any time soon.”
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