The tech IPO market has barely cracked open in 2026. But behind the slow start is a potential pipeline of blockbuster listings — including possible debuts from SpaceX, OpenAI and Anthropic — that could redefine the market when it does.
To understand what’s holding the IPO market back and what could unlock it, Crunchbase News recently spoke with Mike Bellin, U.S. IPO services leader at PricewaterhouseCoopers, via email. He discussed how companies are rethinking IPO timing this year, how investor expectations have shifted since the 2021 boom, and why the next wave of large listings could raise the bar for smaller and mid-cap tech companies.
This interview has been edited for brevity and clarity.
Crunchbase News: How are companies thinking about timing, pricing and capital needs in this uncertain market?
Bellin: The companies we work with have become significantly more sophisticated in their approach to all three dimensions, and the most important shift we’ve seen is a move away from calendar-driven thinking toward readiness-driven thinking.
On timing, companies are no longer asking “when is the window?” They’re asking, “Are we ready when the window opens?” That’s a meaningful evolution.
After years of intermittent issuance windows, late-stage companies have learned hard lessons about the cost of being caught flat-footed. The companies that priced successfully in 2025 had invested 18 to 24 months in advance in governance upgrades, financial reporting infrastructure, and refinement of their equity story.
That institutional preparation is now table stakes. As we’ve noted in our 2026 US Capital Markets Outlook, market windows can open and close quickly, which makes continuous readiness and flexibility essential, regardless of where macro conditions stand on any given day.
On pricing, there’s been a healthy reset in expectations. The exuberance of 2021, when companies could access the market at growth multiples untethered from near-term fundamentals, is not what we’re operating in today.
Investors today are paying a premium for scaled, cash-generative stories with clear paths to profitability. That means founders and their boards have had harder conversations about the right price relative to where comparable public companies trade, rather than anchoring to the last private-round valuations.
The good news is that median pre-money valuations have begun to rise for the first time since 2021, particularly for AI-enabled businesses and later-stage companies with clear profitability trajectories. The reset isn’t a permanent discount; it’s a quality filter.
On capital needs, we’re seeing more disciplined thinking about sizing. Nearly every company going public targets a raise that covers 18 to 24 months of operations, ideally through to profitability.
What’s changed is that companies are also thinking harder about their post-IPO capital structure: How do the IPO proceeds interact with existing debt, what is the all-in cost of capital as a public company, and how does the public currency (stock) open doors for strategic M&A or talent retention?
The best-prepared companies treat the IPO not just as a fundraiser but as a balance-sheet transformation.
It feels like the IPO market is moving more slowly so far this year than expected. Why do you think that is? Do you expect it will pick up?
There are several factors at play, and it’s worth separating the structural from the situational.
On the situational side, the October-to-November 2025 government shutdown had a materially disruptive effect on the capital markets calendar that is still being felt. The SEC reported that issuers filed more than 900 registration statements during the shutdown, all of which required review and processing once operations resumed. That backlog doesn’t clear overnight.
Companies that had been in process for a Q4 2025 or early Q1 2026 launch found themselves delayed, recalibrating roadshow timing, and in some cases choosing to wait for the market to absorb other supply first. So, some of the slowness we’re seeing in early 2026 is the shadow of that disruption.
On the structural side, macro uncertainty — including tariff policy, interest rate trajectory, and geopolitical volatility — has raised the bar for when boards and investors feel confident enough to move forward. Companies are increasingly patient because they have deep pools of private capital supporting them. That optionality is valuable, but it also means that when uncertainty spikes, the default decision is to wait.
That said, we do expect the market to pick up, and we’re cautiously optimistic about the balance of the year. The underlying fundamentals for the IPO market are strong: 2025 demonstrated healthy investor appetite for high-quality offerings, traditional IPOs raised the most proceeds since 2021, and the backlog of IPO-ready companies entering 2026 is among the largest in a decade, with more than 800 unicorns that have now spent additional years strengthening their balance sheets and operating discipline.
As the SEC clears its backlog and macro visibility improves, we expect activity to accelerate, particularly in AI infrastructure, software and specialty risk. The first few deals of any re-opening tend to be conservatively priced to rebuild confidence, and if those hold their post-IPO performance, the door widens for the cohort behind them.
What sorts of companies do you expect to hit the public market this year?
Based on where investor appetite is concentrated, we see the strongest IPO pipeline in several distinct sectors. AI infrastructure, including data centers, power capacity, and chip-adjacent services, leads the pack.
Physical AI: Investor demand for direct exposure to the physical layer of the AI economy is significant, and large-scale, capital-intensive businesses in this space have been able to command premium valuations. The 2025 AI infrastructure IPO set a powerful precedent: Institutional investors proved willing to underwrite capital-intensive, high-growth models when the contracted revenue visibility is strong.
AI-enabled software: This also continues to be a top investor preference. The key distinction from earlier software cycles is that investors are no longer willing to pay high multiples purely on growth. They want to see that AI is genuinely embedded in the product, that net dollar retention is strong, and that the path to margin expansion is credible. Platforms with high switching costs and essential utility are commanding the best multiples.
Insurance and specialty risk: This sector had a strong 2025, and that momentum is continuing into 2026. These businesses tend to offer the cash-flow predictability that institutional investors increasingly prize.
Industrials, aerospace and defense: These are also moving up the IPO pipeline, supported by reshoring policy tailwinds and supply-chain realignment.
How are these listings influencing the strategies of smaller and mid-cap tech companies?
It is real and somewhat sobering. High-profile listings serve as both a benchmark and a warning.
When a well-known, scaled company prices and trades well post-IPO, it recalibrates expectations across the sector, validating the category and giving smaller companies a comparable reference.
But it also raises the implied bar. Investors who have a scaled, cash-generative AI infrastructure company available at a $40 billion to $50 billion valuation will apply that lens to every software or infrastructure company in their pipeline.
Smaller companies are watching their larger peers closely and, in many cases, extending their private timelines. They use the interval to strengthen unit economics, hit profitability milestones, and build out the public company infrastructure (board composition, financial controls, investor relations capability) that institutional investors now expect to see in place on day one.
Given that 2026 has seen a massive surge in venture secondaries, is an IPO still the “Gold Standard” exit? Or is PwC seeing founders use secondaries to delay their IPO even further?
This is one of the most important structural questions in the private markets right now, and the honest answer is nuanced.
The IPO remains the aspirational end-state for most venture-backed companies. It provides the broadest access to capital, the most liquid currency for acquisitions and talent retention, and the clearest signal of institutional legitimacy. In that sense, it retains its status as the gold standard. But what has clearly changed is the sequencing and the role that secondaries play in getting there.
The secondary market has undergone a structural transformation. What was once considered a signal of distress — such as an insider selling before a company was “ready” for the public markets — has been normalized as a sophisticated liquidity tool.
As noted in our 2026 US Capital Markets Outlook, nearly half of asset managers are already using continuation funds to unlock liquidity, and GP-led secondaries and continuation vehicles are now mainstream instruments. Secondary transaction volume surpassed $60 billion in 2025, and the market is projected to continue growing significantly in 2026. Secondaries are expected to remain the dominant exit route for private equity, with IPOs still accounting for only a limited share of total private equity exits.
For founders specifically, we see secondaries being used for several distinct and legitimate strategic purposes:
First, personal liquidity without forced exit timing. Founders who are a decade or more into building their companies have reasonable personal financial planning needs. Secondaries allow them to diversify without forcing the company into a public exit on a suboptimal timeline.
Second, employee retention. Extended hold periods have put pressure on the equity value of employees who joined years ago and expected a liquidity event. Secondary programs provide a release valve, allowing companies to retain talent they might otherwise lose.
Third, valuation discovery in a more forgiving setting. Private secondary pricing, while increasingly sophisticated, is still conducted without the full scrutiny of a public offering, allowing companies to establish a market-clearing price on their own terms.
What we caution founders about, however, is treating secondary access as a reason to indefinitely postpone the public markets journey. The median time to IPO for companies that went public in 2025 has reached over 11 years, the longest in a decade.
Extended private holding periods can be constructive, but they also delay price discovery, compress LP distributions, and ultimately reduce the competitive tension that keeps acquisition valuations high.
The IPO window is selective but open, and companies with the right fundamentals shouldn’t mistake the availability of secondary liquidity for permission to wait indefinitely.
Is PwC advising late-stage founders to prioritize GAAP profitability over top-line growth to satisfy the current “flight to quality” among institutional investors?
We’re not advising founders to make a binary choice between growth and profitability, but we are advising them to have a credible, investor-grade answer to both.
The market signal from 2025 and into 2026 has been clear: Institutional investors are no longer willing to pay premium multiples on growth alone. The “Rule of 40,” the principle that a company’s revenue growth rate plus its profit margin should exceed 40%, and which may now be more a rule of 60, has re-emerged as a baseline screening metric for public market investors evaluating software and tech businesses.
Investors are paying a premium for scaled, cash-generative stories with clear paths to profitability. The emphasis is on paths.
GAAP profitability at the IPO date is not a requirement, but an articulated, credible, time-bound roadmap to it absolutely is.
What has changed is the tolerance for ambiguity. In 2021, investors were willing to fund a narrative about future profitability at an indefinite horizon.
Today, they want to see demonstrated progress in unit economics, such as improving gross margins, reducing customer acquisition costs as a percentage of revenue, and expanding net dollar retention, paired with a specific operating-leverage story. When do sales and marketing efficiency improve? When does R&D spend as a percentage of revenue compress? Where does operating margin land at scale? These are questions that founders must be able to answer with precision, not just aspiration.
The GAAP-versus-non-GAAP debate is also something we work through carefully with companies. Adjusted EBITDA and non-GAAP operating income are widely used and accepted, but institutional investors have become more sophisticated in looking through those metrics to understand certain adjustments as a real economic cost, and to evaluate true free cash flow generation.
Companies that present GAAP financials in a clear, transparent, investor-friendly way, rather than burying them under adjustments, tend to build more durable institutional credibility.
Our practical advice to late-stage founders is this: Make sure your growth spending is efficient and that every dollar of investment is generating measurably improving unit economics.
The investors we work with are sophisticated enough to reward capital-efficient growth with premium valuations and to discount growth that appears to require permanently escalating spending to sustain it.
Governance maturity, financial reporting infrastructure, and a compelling, data-supported equity story are as important to IPO success today as the top-line numbers themselves.
Related Crunchbase query:
Related reading:
Illustration: Dom Guzman
Stay up to date with recent funding rounds, acquisitions, and more with the
Crunchbase Daily.
