Why the IPO Market will reopen in 2025

With every new Administration, there is a changing of the guards. This happens within every major government department, some notable roles include the Treasury Secretary, the heads of the SEC/FTC etc. Depending on your position, this change can either be bullish or bearish.

The momentum either works for you or against you. Right now the momentum is working for investors, and will continue to be the tailwind for Big Tech. Let's dive into a few market changes, what I'm seeing in the markets and how to take action.

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Investment Banking Reports

Every few months, I'll read through several publications from the top investment banks in my field. For starters, firms like J.P. Morgan and Goldman Sachs hire the best and brightest. Their teams cover every industry, asking the macro and micro questions. Another one firm I revisit for fintech data is FT Partners.

The primary reason to read these reports is to find the answers to questions I haven't asked yet. This is definitely one of the advantages when you have large +1,000 person teams.

J.P. Morgan's Guide to the Markets

If you are looking to expand your investment knowledge base, I recommend starting with J.P. Morgan's Guide to the Markets. This is an in-depth 71-page guide that breaks down every aspect of the market, from equity to fixed income. You will learn about correlations you knew existed between different asset classes.

Goldman's Top of Mind

The best economist are at Goldman Sachs. I don't say this lightly because economics is a tough job. Personally, I think if economist were great at forecasting, they would be investor. However there seems to be exception at Goldman. Their economists are very detailed with their macro-thinking approach.

In this edition, the team breaks down tariffs, taxes and fiscal policy. The report is only 32-pages and I recommend reading it for the interview excerpts. If you have specific trade policy questions, the team probably answered them below.

FT Partners

Since I focus on financial software, fintech reports are my natural preference. FT Partners is by the best when it comes to thorough analysis. This 119-page report provides deal statistics, investment trends and sector research for every category.

With this report, you will have a deeper understanding of the financing activities within the fintech market. After a 24-quarter low, financing and capital raises are picking up again. In fact, M&A activity YTD Q3 in 2024 has reached $165b, which is greater than 2023 and 2022 levels.

Healthy M&As fail may fail before year-end

As an investor, my primary concern is how regulators will react before 2025. If someone fears losing their job, taking aggressive action will speed up the decision-making process. Right now it seems that a few deals I've been watching might be on hold until further notice.

The $14 billion HPE-Juniper deal may halt

Earlier this year, our team worked on the HPE-Juniper $14 billion M&A deal, which is expected to close this quarter. However a few regulatory bottlenecks may halt the deal this month. Now there's a lot of money tied up in this deal. And it's one example where investors may wait until 2025 for the Trump Administration for more favorable terms.

The problems is investors can't wait. Every day costs millions of dollars for a $14 billion deal. Waiting also increases deal uncertainty when it comes to closing. If the DOJ is creating roadblocks now, it may become a bigger problem for investors before year-end.

The passing of the M&A baton

At the moment, it seems like several M&A deal decisions will slow down this quarter. Between the holidays and new Administration, it is unlikely stakeholders will make hard decisions. In the short run (2-3 months), this delay will feel like forever for investors. However, it seems like regulations will lighten up going into 2025.

Any reduction in regulations will increase the speed of decision-making. And if rates continue to stay low or go lower, corp dev/M&A teams will dust off their old M&A deal pipelines. Any deals that failed or didn't close since 2022, will be revisited.