Hasta La Vista, Liquidity Crisis? Tech IPOs Show Signs of Life!

I'll Be Back...With Profits?

For over three years those venture capitalists have been waiting. Waiting for the moment the tech IPO market starts pumping again. Like me waiting for Sarah Connor. They have been saying "I'll be back". Turns out maybe they were right. Tech IPOs flatlined faster than a T 1000 in molten steel in early 2022 due to inflation and interest rates that were higher than my kill count. Big acquisitions? Forget about it. Regulations were tighter than my leather jacket. But the first half of 2025? That's when things got interesting. June was the hero month. Like me blowing up Cyberdyne Systems. All in all there were five tech IPOs last month accelerating from a monthly average of two since January.

Crypto Goes Boom: No Judgement Day Here

Circle a crypto company more than doubled in its New York Stock Exchange debut on June 5 and is now up sixfold from its IPO price for a market cap of $42 billion. That's more impressive than my ability to mimic human voices. Seems the Senate passed the GENIUS Act which would establish a federal framework for U.S. dollar pegged stablecoins. Venture firms General Catalyst Breyer Capital and Accel now own a combined $8 billion worth of Circle stock even after selling a fraction of their holdings in the offering.

Figma: The Design Software Savior

Silicon Valley big shots Greylock Kleiner Perkins and Sequoia Capital are set to soon profit from Figma's IPO after the design software vendor filed its public prospectus on Tuesday. Since its $20 billion acquisition agreement with Adobe was scrapped in late 2023 Figma has been one of the most hotly anticipated IPOs in startup land. It's "refreshing and something that we've been waiting for for a long time," said Eric Hippeau managing partner at early stage venture firm Lerer Hippeau regarding the exit environment. "I'm not sure that we are confident that this can be a sustained trend yet but it's been very encouraging."

CoreWeave: The Infrastructure That Could

Another success story is artificial infrastructure provider CoreWeave which went public in late March. The stock was relatively stagnant for its first month on the market but shot up 170% in May and another 47% in June. That's the kind of performance that makes me want to say "Talk to the hand!" to the bears. But like Skynet the market can be unpredictable. So proceed with caution.

Zombie Companies? Not On My Watch!

After a record year in 2021 things slowed down. Venture firms faced increasing pressure to return cash to investors. The National Venture Capital Association warned about a "backlog of liquidity drought risks creating a 'zombie company' cohort." Zombie companies are businesses generating operational cash flow but lacking credible exit prospects," the report said. Other than Circle the latest crop of IPOs mostly consists of smaller and lesser known brands. The highest valued private companies like SpaceX Stripe and Databricks remain on the sidelines and AI highfliers OpenAI and Anthropic continue to raise massive amounts of cash with no intention of going public anytime soon.

There is Light at the End of the Tunnel...Maybe

The IPO market is starting to open and the VC world is cautiously optimistic. Secondary sales are on the rise and even Mark Zuckerberg is making moves in the AI space. Investors hope the Federal Reserve will move toward a rate cutting campaign though the central bank hasn't committed to one. Mike Bellin anticipates a diversity of IPOs across sectors in the second half of the year. But potential roadblocks remain. Tariffs geopolitical uncertainty and other than CoreWeave and Circle recent tech IPOs haven't had big pops. Still virtually any activity beats what VCs were experiencing the last few years. Hippeau said recent IPO trends are generally encouraging. "There's starting to be kind of light at the end of the tunnel," Hippeau said.