Market Downturn Impacts Startups' IPO Timelines

The recent market downturn, triggered by Trump's tariffs, has significantly delayed startups' plans for initial public offerings (IPOs), pushing their timelines back by at least one to two quarters. This subdued sentiment has also affected private markets, where deals are now stuck over valuation concerns.

Investors Approach with Caution

Despite sitting on substantial capital and big private equity (PE) funds actively scouting for startup investments, the correction in public markets has led investors to renegotiate valuations. This has delayed the closure of sizable deals, as fund managers, investment bankers, and consultants have pointed out.

Valuation Adjustments in the Pipeline

Startups in urgent need of funding may have to settle for lower valuations, while those raising pre-IPO capital might need to accept flat valuations. The uncertainty about the global macro environment persists, keeping investors cautious, even with the US announcing a 90-day pause on reciprocal tariffs for countries excluding China.

Private Markets Offer a Silver Lining

From a broader perspective, private markets currently present a more attractive option for investors and startups alike. Experts predict that overall funding, including big deals, should pick up pace in the coming months, provided that valuations become more rational in the unlisted space.