For the first time since 1978, there were no venture-backed Initial Public Offerings (IPOs) in the second quarter of 2008, according to the Exit Poll report by the National Venture Capital Association (NVCA) and Thomson Reuters. This figure, in combination with only five venture-backed IPOs in the first quarter of 2008 represents a significant decline compared to the 43 companies that went public in the first half of 2007. According to the NVCA, the situation is "concerning enough to be characterized as a capital markets crisis for the start-up community."
"Venture-backed companies that successfully enter the public markets represent a critical job creation engine for the United States economy, and that engine has completely shut down," said Mark Heesen, president of the NVCA. "We need to put regulators, legislators, presidential candidates, and the private sector on notice that this situation represents a serious problem that will have long reaching economic implications if not addressed. We view this quarter as the ‘the canary in the coal mine’."
The following chart illustrates the trend in venture-backed IPOs on a quarterly basis since 2005 (click the chart to view a larger version):
For additional data, a PowerPoint presentation is available from NVCA (click below to view).
For more information:
- No Venture-Backed IPO’s Issued in the Second Quarter of 2008 (July 1, 2008)