Wall Street’s initial public offering (IPO) market has cooled noticeably in recent weeks, as tepid investor demand and growing concerns over company valuations have stalled what had been expected to be a robust quarter for new listings. Several high-profile companies, including petrol station operator EG Group, nuclear technology firm Holtec, wearable device maker Oura, and data center developer SB Energy, have all delayed their plans to go public in the United States. Bamboo Insurance also postponed its IPO last month.
Investor sentiment in the US equity capital markets has been dampened further by the delay of two highly anticipated IPOs. Anthropic, a company backed by investors hoping for a valuation exceeding $2 trillion, now anticipates a public listing in mid-November, after the US midterm elections, pushing back its earlier target. Similarly, AI rival OpenAI has postponed its IPO to the following year.
An executive at a major US asset management firm noted that investor interest is currently heavily focused on Anthropic, with little enthusiasm for other offerings. This sentiment reflects broader caution, despite investment bankers experiencing a strong year so far. The market was boosted by SpaceX’s record-setting $86 billion June IPO and by debt issuances from Silicon Valley technology groups funding significant data center expansions.
However, concerns about a potential downturn in the artificial intelligence sector and growing opposition to data centers have caused many smaller IPOs to be shelved. A senior banker highlighted investor skepticism toward what some describe as “tone deaf” valuations underpinning many AI-related companies. For example, SoftBank-backed SB Energy is pursuing a valuation near $50 billion despite not having any operational facilities.
Recent data show that technology IPOs in 2023 have experienced an average decline of approximately 23 percent following their first day of trading, fueling fears that banks may be overvaluing deals to secure underwriting mandates. While some major IPOs such as SpaceX saw initial trading-day surges, those gains have generally evaporated in subsequent weeks. An investor from a UK boutique bank observed that IPOs are often “massively oversubscribed by fast money playing these first-day pops,” only to lose value afterward.
Meanwhile, early investors in companies like SpaceX retain substantial unrealized profits, causing concern among newer investors who feel at a disadvantage. A former equity capital markets banker remarked that “all the gains are for the private holders,” leaving newcomers facing a “raw deal.”
Broader economic factors have also contributed to the cautious mood. Fluctuations in oil prices and a global sell-off in government debt markets have heightened risk aversion among investors. The hotel group Ennismore, backed by France’s Accor, was reportedly considering a New York IPO this year, but the evolving market climate may delay those plans; neither company has issued a formal statement.
EG Group had aimed to raise approximately $1 billion at a $9 billion valuation in an autumn listing but has now deferred its IPO until 2027. The latest shifts underscore the challenges facing Wall Street as it navigates volatile market conditions and recalibrates expectations for public offerings.