Why Some Companies Are Holding Back IPOs and Others Steaming Ahead

In a recent article published by CFO Brew, abundant funding opportunities in the private markets and an uncertain macroeconomic environment were discussed as insight from Ro Sokhi, a partner at UHY LLP, on what is keeping some companies private.

Some massive, and we mean massive, companies are going public right now, which has market experts postulating that 2026 could be called the “year of the mega-IPO.” SpaceX, which went public on June 12 and already has a market cap of nearly $2.4 trillion, will likely be joined by fellow AI giants Anthropic and OpenAI.

Those three are in a class of their own. Executives of the other 99.9% of companies weighing an IPO or that have filed for one have far different calculations to make than Elon Musk or Sam Altman do. As Ali Ghodsi, CEO of AI data platform Databricks, recently told Bloomberg: “We will be a public company. I just think this is a terrible year to go public.”

What’s keeping companies like Databricks private, besides the expected stream of gargantuan tech IPOs? Ro Sokhi, a partner at UHY, homed in on two factors: abundant funding opportunities in the private markets and an uncertain macroeconomic environment.

“I’d say the broader reason for companies staying private longer is really that companies no longer need to be in the public markets to access capital like they once did,” Sokhi told CFO Brew. Companies may also be waiting for “a better window” to go public, he added, instead of doing it at a time of inflation, high interest rates, and tariffs.

Deregulation. The dearth of public companies has the eye of regulators like SEC Chair Paul Atkins, who observed in a December speech at the NYSE that the number of publicly listed companies in the US was down roughly 40% from the mid-1990s.

The SEC is on a mission to “make IPOs great again,” as Atkins recently stated. But it may have limited success in achieving its mission. Sokhi said “the commission is likely overestimating” the regulatory burden as a reason companies stay private. “Compliance costs are important, but they’re only one factor,” he said.

Read the full article published by CFO Brew.