IPO Analysis and Implications

Over the next two years, we will see a wave of IPOs in the Professional Services sector unlike anything before. We’re already hearing from multiple management teams under Private Equity ownership that this is exactly where they’re heading. These listings will either validate or burst the recent valuation hype the industry has been living in. The large consolidators and high-growth challenger platforms have reached a turning point. Many are now too big for another PE sale, leaving the public markets as their only credible path to liquidity. Few are hiding that ambition. But IPOs will be the ultimate test: can these firms really sustain software-like valuations of 20x+ EBITDA once the market looks beyond the roll-up narrative? Much of the sector’s value has been created through rapid acquisition rather than genuine integration. In some cases, what looks like scale is simply a collection of smaller firms stitched together under a common brand. Public markets are unforgiving of that. They penalise volatility, Partner churn and dependence on key individuals. If growth slows, Partners cash out and the cultural glue that held disparate teams together weakens, the cracks will appear quickly. Once lock-ups expire, the flight risk is real. The best people, who are the true assets, may take their client relationships and start again elsewhere to realise greater equity value in earlier-stage firms. Everyone has been asking what the endgame is for Private Equity in Professional Services. This is it. The coming IPOs will determine whether this model can truly scale and sustain its multiples, or whether the market will impose a reset in how we value people-based businesses.

If the IPO happens, your cap rate math is about to get a new variable: Wall Street’s profit target. Before 2008, Fannie and Freddie were publicly traded, shareholder-driven — and the unofficial engine of cheap apartment debt. The implied government guarantee kept borrowing costs low, cap rates compressed, and prices climbing. When the crisis hit, they were taken over and placed under FHFA conservatorship. Stability, not profits, became the mission. Now the plan is to flip the switch back. An IPO would put them under Wall Street’s growth demands again. That changes incentives — and incentives change pricing. Second-order effects if multifamily loan spreads widen and the guarantee is reworked, even slightly: Cap rates drift upward as the cost of debt rises. Value-add deals built on aggressive leverage stop penciling. Smaller sponsors, most dependent on agency execution, get squeezed out. More CRE debt flows to banks and private lenders at today’s higher rates. What to watch: How the backstop is structured — implied vs. explicit guarantee. Capital rules FHFA sets for the GSEs post-IPO. Changes to annual multifamily lending caps and mission requirements. Apartments didn’t just get built and traded on rent rolls — they were built on cheap, reliable agency debt. Change that foundation, and the math on every deal changes with it. https://lnkd.in/esKtuQin

📈 The surge of private equity-backed IPOs in 2025 creates strategic opportunities for Family Offices managing multi-generational wealth. Nine of ten major IPOs from 2024 exceeded their listing prices, with half achieving gains above 100%, signaling robust market appetite for quality offerings. Today's IPO candidates like Medline and Genesys represent a departure from 2021's speculative listings, bringing proven profitability and established operations to public markets. This shift aligns with Family Offices' focus on sustainable value creation. The projected $38 billion in IPO activity demands precise portfolio positioning. Strong public valuations and president-elect Trump's expected policy changes suggest optimal timing for private equity position reviews. However, the broad market's 70% rise from 2022 lows, concentrated among select large-caps, requires careful entry point analysis. Upcoming fintech offerings from Klarna and Chime will provide valuable benchmarks for private technology holdings. Family Offices should focus on companies with proven business practices, using established relationships to secure preferred investment access while maintaining long-term portfolio balance. Working directly with over 100 Family Offices across three continents, we've observed a marked shift in IPO participation strategies. Many are building dedicated teams to evaluate these opportunities, combining traditional investment analysis with new approaches to assess management quality and growth sustainability. Several Family Offices have successfully negotiated cornerstone positions in recent IPOs, securing board observer rights and maintaining influence similar to their private market investments. The true value in this IPO wave extends beyond immediate investment returns. Family Offices that position themselves as strategic partners rather than passive investors often secure advantages in deal flow, co-investment rights, and governance participation. This approach has proven particularly effective in mid-market offerings where Family Office capital and expertise can significantly influence outcomes. As IPO activity accelerates through 2025, successful Family Offices will distinguish themselves through selective participation, focusing on companies where their industry expertise and long-term capital can create mutual value. This renaissance in public offerings marks not just a liquidity event, but an opportunity to reshape how Family Offices engage with public markets for generations to come. #IPO #FamilyOffices

“Don’t do an IPO, get ready to be a high-performing public company” Since last year, our research desk at xto10x has studied the performance of all venture-backed startups that have gone public. The findings are concerning: 77% of venture-backed startups that went public since 2020 meaningfully underperform the index eight quarters after IPO. Why is this? As founders in the venture ecosystem we have a certain orientation - go after a large market, set very high revenue ambitions and prioritise speed over efficiency (with the belief that decent unit economics will translate into profitability later). This approach leads to the creation of breakout companies but with some serious costs - challenges in becoming profitable without losing growth, low ROCE (return on capital employed), lack of headroom in the core business creating pressure to launch new businesses, inability to hit an annual plan (missing by 30% is fairly common), and lack of “boring” progress in core operating metrics month over month, year after year. Momentum in the private markets does not automatically translate into public company performance - this is not a transition, it’s a transformation.  With this need in mind, we launched the xto10x IPO Academy in January with our first cohort of founders and CFOs from seven companies: Amagi, Capillary, Exotel, Medibuddy, Razorpay, Scripbox, and Solar Square. The goal is not about doing an IPO but to build a foundation for strong public market performance over years. Some of the key themes we have covered include: 1. Do you have a business designed for superior performance compared to peers, supported by a simple narrative? 2. Are the founders able to delegate day-to-day execution to a strong team and focus on the next set of initiatives for growth and profitability? 3. Does the business demonstrate steady progress in operating metrics which translates into profit growth faster than revenue growth (e.g., same account growth in SaaS, revenue from retained customers in B2C)? 4. Is the board set up to add real value to the business (beyond statutory responsibilities)? 5. How do you prepare for the regulator's disclosure expectations; is transparency a competitive advantage? 6. Learn from others - build deeper awareness of the successes and challenges of startups who have gone public 7. Take inspiration from excellence outside business e.g., Paddy Upton (coach), Abhinav A. Bindra OLY (India's first individual Olympic gold medalist) and Vipul Shinghal (Lt. General, Indian Army) Over the next few weeks, I will share some more details from the individual sessions and the work we have done. It has been a privilege to work with incredible faculty - from startup founders who have gone public to industry stalwarts like Mohandas Pai (see photo below, after his session on the role of the CFO) who’ve helped build our public markets over decades. If you have any suggestions or questions, please do write to me at saikiran@xto10x.com. 

📺 📲 I came across the news of Amagi preparing for an IPO and decided to spend some time digging into it properly. I looked the announcement, the timing, the market choice, and what this move might say about the current state of media, video infrastructure, and advertising-led distribution. I went through filings, financial press, and market analysis and pulled everything together in a long-form piece. It’s an attempt to make sense of the signal behind the event. I structured the article around four very concrete questions: ❓ Why is Amagi going public now ❓ Why is the listing taking place on the Indian stock market ❓ What, if anything, does this signal to the wider media and sport ecosystem ❓ How have other advertising and video infrastructure IPOs in this market actually performed Also, between you and me, I expected they had more revenues 🤨 The article is deliberately long and modular. You can read it end to end, or jump straight to the parts you care about. What’s inside: ➡️ A factual IPO timeline with real subscription data and consolidated revenues ➡️ An explanation of why FAST mattered for Amagi’s growth, without treating it as dogma ➡️ A capital-markets view on why India makes sense as a listing venue today ➡️ What this means for media and sport organisations looking at infrastructure partners ➡️ A detailed appendix on how similar US IPOs in ad-tech and CTV infrastructure played out ➡️ Full sources, filings, and financial documents linked at the end Disclosures This article is independent analysis, written in my personal capacity, if I made mistakes let me know. A guy with a scarf Amagi #IPO #CTV #FAST #video #investing --------------------------- A guy with a scarf is collaborating with Dolby OptiView - Enabling live sports experiences that engage and captivate fans. #ad

Are IPOs a path to quick riches or a trap for the unwary? We analyzed 20+ years of data across 2,000 Indian IPOs, and the "base rates" might surprise you. While the median listing day gain is a tempting ~8%, the long-term reality is different: 📉 The Flattening Effect: Returns tend to flatten significantly 1-6 months post-listing. 📊 Index vs. IPOs: The median long-term annualized return for IPOs is ~10%, actually underperforming the broad market (12-13%). Only ~40% beat the index. 🗓️ Vintage Risks: IPOs cluster during market peaks when valuations are highest—great for sellers, often tough for buyers. In this video, Shray and I break down why chasing new listings can hurt returns, why size matters (smaller IPOs often fare better), and our fund’s specific framework for evaluating new issuances. Capitalmind Mutual Fund Capitalmind #CapitalmindFlexicapFund #IPOs #InvestmentPhilosophy

We are meeting an increasing number of European founders who ask whether they should list in the US rather than in Europe. The US market can appear more compelling when it comes to executing an IPO. There is certainly greater attention and more positive publicity associated with a US listing $$. As a global investor, Amundsen invests in both US and European IPOs, so we tend to be agnostic about listing location. However, US and European IPOs can display very different trading patterns in the days and weeks following listing. Below, we illustrate the average performance of IPOs over the past two years (offer sizes above USD 50m): 58 IPOs in Europe and 152 IPOs in the US. The average size of European IPOs was USD 460m, compared with USD 427m for US IPOs (yes - IPOs are larger in EU than in the US on average). We observe that the Day 1 / Week 1 “IPO pop” is, on average, very strong in the US—roughly three times that observed in Europe. In these circumstances, it is no surprise that (1) IPO allocations are extremely competitive and (2) we often hear sellers complain about mispricing and “free lunches” being given to IPO investors. Looking beyond the initial “pop,” the picture is quite different. The data shows that US IPOs tend to underperform on average over time. Most of the “alpha” is generated at the time of the initial IPO allocation. Perhaps the IPO was not underpriced after all. European IPOs may look less “hot” at pricing and are typically less chased in the aftermarket. However, their average performance tends to be better over time, with investment duration contributing meaningfully to returns. In the end, selection matters most for us as investors. Listing location does not. For founders and issuers, we advise listing where it makes the most strategic and business sense. Achievable IPO size (market capacity) and post-IPO performance (investor engagement and support post listing) can be equally strong in both regions. An IPO is the only moment when a company and its owners can choose their public shareholders and set the stage for aftermarket performance. It should be used wisely.

Among entrepreneurs, an IPO is widely considered the Holy Grail. Flashlights, your company banners proudly waving on Wall Street, cheering crowds at the trading floor, and, indeed, the steadily growing price of your ticker on Bloomberg terminal. But many tend to forget that an IPO is not the end, but just the beginning of the next very important chapter of your company’s history. Here’s what no one tells you about the day after you take your company public. Once the excitement of the IPO day has faded, you’re waking up to the fact that your responsibilities have changed drastically overnight. It's been over a decade since I made my humble contribution to taking Luxoft public on the NYSE. It was one of the first technology companies originally from Eastern Europe to make that leap. One moment, I celebrated on the trading floor, the next, I faced a dramatically expanded universe of stakeholders, each with their own expectations and demands. The burden on executives doesn't gradually increase after your company IPOs - it instantly explodes. Looking back, there are some critical insights I wish someone had hammered home to me before our IPO. 1️⃣ First, conduct a thorough gap analysis before you ring that bell. Identify every new function, process, and capability you'll need post-IPO. 2️⃣ Second, place your absolute top talent in newly critical roles. Your investor relations leader, for example, needs financial acumen, strategic vision, and exceptional communication skills. 3️⃣ Then, embrace the transformation of existing leadership roles. Your CFO will transition from financial steward to market-facing strategist. Your legal team will shift from facilitating business to protecting it. Even your board dynamics will fundamentally change as fiduciary responsibilities intensify. Finally, do not forget that your company's performance is now on the radar of dozens of financial analysts. Now you have way less flexibility in decision-making and experiments. It’s all about meeting your own quarterly targets. You miss two to three in a row - your stock turns into junk. Do as much of the risky stuff as possible while you are still private. The most successful public company transitions happen when leaders anticipate these inevitable shifts and prepare their teams for their new reality. The companies that struggle are those whose leaders treat the IPO as the finish line rather than the starting gun. For those contemplating taking a company public, don't just prepare for the IPO day. Prepare for the day after, and all the days that follow. And don’t forget to ask yourself: “Will my company and its shareholders really benefit from public listing?” But that is a topic of another post.

The 53rd Annual Securities Regulation Institute in San Diego sent a clear signal 📢: meaningful change is coming to the public-company disclosure regime — and it is squarely aimed at revitalizing the IPO market. Feedback from U.S. Securities and Exchange Commission staff, including Corp Fin leadership, points to a broad effort to modernize Reg. S-K, reduce friction to going public, and make life easier for companies that want to stay public. Here’s what issuers and IPO candidates should be focused on now 👇 🔹 “Make IPOs great again” is not just rhetoric The SEC’s view is that the current disclosure framework has become overly prescriptive, duplicative, and misaligned with how companies actually operate. • Fewer rigid line-item checklists • Greater reliance on materiality • More proportional disclosure based on company size and complexity That is a real positive for first-time issuers and growth companies considering the public markets. 🔹 Key Reg S-K areas under active reconsideration Several items that routinely slow IPOs and complicate reporting are in play, including: • Insider trading policy disclosures • Related-party transaction thresholds (Item 404), potentially moving to a materiality-based standard • Cybersecurity disclosures (Item 106) • Item 701 equity issuance disclosures • Item 201 — including eliminating the five-year stock performance graph These are not minor tweaks — they go directly to IPO prep timelines and disclosure risk. 🔹 Expanded access to scaled disclosure Expect serious movement on: • Raising SRC thresholds and expanding availability of scaled disclosure • Extending EGC status beyond the current five-year limit • Expanding Form S-3 eligibility to improve post-IPO capital flexibility For companies weighing IPO timing, these changes could materially affect readiness and cost. 🔹 Legacy rules under the microscope Conflict minerals disclosures were specifically flagged, particularly given global competitiveness and national-security concerns around rare earth supply chains. 🔹 The SEC previewed an active rulemaking calendar, including potential 10-Q optionality and other changes that could reshape periodic reporting obligations. 💡 The most important message: the SEC is actively asking for input. Corp Fin leadership wants issuers, banks, investors, and advisors to identify rules that are outdated, inefficient, or no longer serving investors. This is a real opportunity to help shape the next phase of public-company regulation. We will do so! From an IPO perspective, this aligns with what we’re seeing on the ground. Companies that prepare early, focus on materiality, and build disclosures with an eye toward both regulators and investors are executing more efficiently and succeeding in the market. Thoughts? #IPO #CapitalMarkets #SEC #PublicCompanies #GoingPublic Ben Smolij Brian Jue Peter Goldstein Eric Johnson Mark Barron Winston & Strawn LLP