IPO Market Outlook: Window Reopens, But Expect A Convoy, Not A Stampede

The pace of U.S. venture-backed IPOs so far this year has not exactly been robust. However, there has been a marked uptick in public offerings compared to recent years. And, for those who have made their debuts, the market reception has been exceptionally positive overall.

Some of the more successful public debuts we鈥檝e seen include design software provider 鈥檚 blockbuster IPO, which set an initial valuation for the company of just over $19 billion. As of mid-August, Figma鈥檚 market cap hovered at nearly $34 billion. There was also . The New York-based stablecoin provider, with a market cap of over $33 billion, has seen the value of its shares rise more than 4x following its early June IPO.

, founder and managing partner of global investment platform , is not surprised by the rebound in IPOs this year. In her view, it was inevitable.

鈥淚t is the norm to see four- to five-year cycles in the capital markets,鈥� she told 附近上门 News. 鈥淲hat we鈥檙e seeing in 2025 is the strongest U.S. IPO market since 2021, and it鈥檚 overdue. For the past four years, companies were effectively trapped in the private markets, and investors were starved of new opportunities.鈥�

What is striking to Freidheim 鈥� who has served on multiple and boards 鈥� is not just the quantity of deals, but the quality. Companies going public today are 鈥渇undamentally stronger鈥� than the last cycle, she said.

鈥淢ost have cut costs, proven unit economics, and learned the hard lessons of the 鈥榞rowth at any price鈥� era, especially in tech,鈥� she said.

Another important difference from the last IPO boom, added Freidheim, is that 鈥減erformance has been rational鈥� with 鈥渕ore measured debuts.鈥�

鈥淚n some ways, the restraint is the most encouraging signal,鈥� she said. 鈥淚t suggests the IPO window isn鈥檛 just reopening, it鈥檚 maturing.鈥�

, co-founder of , agrees that 2025 so far marks a notable U.S. IPO comeback, powered by strong openings. But that has all been tempered by 鈥渕ixed follow-on performance and smaller deal sizes,鈥� she added.

The next wave

So what鈥檚 ahead for the remaining few months of 2025?

Mignano predicts there will be continued renewed momentum in IPOs, especially 鈥渁s markets stabilized after tariff volatility earlier this year.鈥�

, general partner and co-head of late-stage investment platform , agrees that we should expect to see growing confidence, a strong ecosystem and more IPOs.

鈥淔or example, pre-IPO investors aren’t demanding as big a discount as they were six months ago because the perceived IPO risk is decreasing,鈥� she said. However, she acknowledges that there are several macro risks 鈥渢hat could quickly derail the markets.鈥�

鈥淏ut I think recent market experience has taught companies to take advantage of opportunities when they present themselves, so we should expect they will dance as long as the music is playing,鈥� Kirk said.

In Freidheim鈥檚 view, the strongest companies so far in 2025 with the clearest investor demand 鈥渨ent first,鈥� setting the stage for the next wave of IPOs.

鈥淲e may see a bit of delay in the second half, but the direction of travel is intact,鈥� she said.

However, she doesn鈥檛 expect we鈥檒l see a flood of IPOs in the remainder of 2025.

鈥淭hink of 2025 less as a stampede and more as a convoy: flagships go first, mid-caps follow in formation,鈥� she said. 鈥淎nd that cadence is exactly what a healthy, sustainable IPO market looks like.鈥�

AI factor

While artificial intelligence companies have been by far the largest recipients of venture capital funding in 2024 and 2025, it鈥檚 still too early to see them take to the public markets.

Views are mixed as to when we might start seeing AI companies actually start to IPO.

Kirk believes that many companies looking to IPO will try to position themselves as net winners from AI adoption, but 鈥� investors will need to discern whether that’s really the case.鈥�

Mignano points out that historically, venture-backed tech startups take 10 to 15 years from founding to IPO. However, she thinks that if early-stage AI companies can scale faster thanks to cloud distribution, automation and capital investment 鈥斅燼nd if the IPOs for late-stage AI unicorns already scaling (such as , , ) perform well this year 鈥� that 鈥渃ould increase investor interest and shorten the traditional IPO runway to less than 10 years for today鈥檚 early-stage AI startups.鈥�

If that is the case, the AI early-stage companies born in 2023 through 2025 could IPO as early as 2029 to 2031, she predicts.

Freidheim believes that we鈥檙e likely 12 to 24 months away from seeing the first true wave of AI IPOs.

鈥淭he demand is undeniable. Investors want direct exposure to AI pure plays, not just the tech giants who dominate the space today,鈥� she told 附近上门 News. 鈥淏ut markets reward discipline: The companies that succeed will be those with sustainable business models, predictable revenue, and real customer adoption. The technology is moving faster than the capital markets, but the pipeline is there, and once a few credible leaders break through, the rest will follow quickly.鈥�

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