IPO Drought Is Not About Tech

Ever since RackSpace went public earlier this month, I’ve read dozens of articles and blog posts lamenting the state of technology IPOs. A lot of it is Techmeme echo chamber weeping about how they’re being shunned by the rich kids on Wall Street, while you’ve also had folks blaming early-decade regulations (SOX makes it too expensive, separation of I-banking and research makes it too hard to get noticed, etc.).

So let me say something to tech’s narcissistic saddies: This isn’t about you! The entire IPO market is in the tank, and tech isn’t being punished much worse than most other sectors. For example, it’s been six full months since a pharma company went public, and that offering was a disaster.

I’m not asking techies to stop worrying, but just to see the forest for the trees. There have been just two IPOs to price this month on U.S. exchanges, and just 30 for the entire year. That compares to 138 through last August, and 217 for all of 2007. It’s hard all over, and the underlying causes are far more permeating than any anti-tech bias or regulations Eliot Spitzer dreamed up.

Here’s some data from Thomson Reuters, on the past 12 months of IPO pricings: IPOs_Aug 14.xls