Last year's investors' dreams of a robust IPO pipeline for 2024 are fading, if not disappearing entirely, as we approach the halfway point of the year.
2024 looked like it might finally generate the momentum investors were hoping for in 2023, with four venture-backed tech IPOs in March and April – Reddit, Astera Labs, Ibotta and Rubrik. But despite the success of these four, secondary investors and IPO lawyers recently told TechCrunch that the IPO market won't fully reopen until 2025 or later, given macro conditions such as the looming presidential election and rising interest rates.
This year is expected to be a better one than 2023, with several more public offering filings expected throughout the year. The timeline for IPOs remains unclear, although companies such as Klarna and Shein are in talks with banks and the deadline appears to be approaching.
In most cases, it may be easier to determine which companies won't go public this year than those that will. Some late-stage startup CEOs have stated that they won't go public in 2024, while others have made financial moves that suggest a public listing is not imminent. Here are some venture-backed tech companies we expect won't go public this year.
Plaid CEO Zach Perret said at an Axios event in March that the B2B fintech doesn't plan to IPO in 2024. This is consistent with what TechCrunch's Mary Ann Azevedo reported last October after the company hired a new CFO. Plaid was valued at $13.4 billion in 2021, its most recent valuation. Design unicorn Figma hasn't directly said it won't IPO this year, but its actions point in that direction. In May, the company made a tender offer to allow existing investors and employees to sell Figma shares on the secondary market if they wish. This type of liquidity event doesn't usually happen right before a larger liquidity event, an IPO. The tender offer valued the startup at $12.5 billion, lower than the $20 billion Adobe was willing to pay but higher than the $10 billion valuation Figma received in its previous first round. Stripe also made a tender offer to current and former employees earlier this year. In February, the fintech unicorn announced a secondary sale that would value the company at a staggering $65 billion. While this is lower than the $95 billion valuation the company received in 2021, the company is building up its valuation again. This is a sign that Stripe is looking to build up a bit more valuation before going public. AI cloud platform Databricks is also likely not on the books for 2024. This may be disappointing for venture capital investors who expected the company to be the first public company last year. The company raised $500 million in new capital in a Series I round last fall, valuing the startup at $43 billion. While it is not normal for companies to raise money just before going public (after all, it is part of the IPO process), the investors who raised in this round were crossover investors like T.Rowe Price. These are not investors who tend to be against IPOs when market conditions improve, and they will likely be one of the first public listings of 2025 if they want to. Canva likely won't go public until at least next year, with the design startup likely waiting until 2026. Cliff Obrecht, co-founder and husband of Canva CEO Melanie Perkins, told Australian and New Zealand tech publication Startup Daily in March that an IPO was at least 12 months away, and likely sometime in 2026. But lucky for US investors, Obrecht made it clear that if the startup were to consider going public, it would do so in the US.
TechCrunch is monitoring the late-stage startup and exit market and will continue to update this article. If you have any tips or suggestions you'd like to share with us, please reach out to us at rebecca.szkutak@techcrunch.com.