Companies Trim, Delay IPOs in 2026 as Volatility Tests Valuations

The early 2026 IPO market faces significant headwinds driven by a broad software sector selloff, valuation compression, and cautious investor sentiment. Three prominent cases illustrate the challenging environment for new public offerings:

, a New York-based prime broker, initially targeted a $1.05 billion fundraising but cut this by approximately 65% to $364 million before postponing the listing entirely, citing “market conditions” [1][2][3]. The company, which reported expected net revenue between $1.04 billion and $1.06 billion in 2025 (compared with prior-year $463.6 million), was impacted by the AI-driven selloff in financial stocks and decline in crypto markets [3].

, a Brazilian fintech, reduced its deal size by over 50%, cutting the price range and selling 20 million shares at $12 each (compared to the original target of 43.6 million shares at $15-$18) [1][4]. The company raised $240 million in its downsized U.S. IPO, but the stock fell approximately 15% from the offer price by the next trading close, demonstrating the weak investor appetite for new listings [1][4].

(Blackstone-backed) postponed its planned New York listing, citing “current market conditions” and a steep software-stock selloff [1][5].

The technology sector has been the most significantly impacted. The NASDAQ Composite declined 4.0% over the past 20 trading days (from $23,639.69 to $22,693.79), underperforming the S&P 500’s 1.27% decline and the Dow Jones’ 0.41% gain [0]. The S&P 500 software and services index posted its worst three-month performance since May 2002, according to Evercore ISI equity strategists [6].

: Several public software companies are now trading at approximately one times their forward revenue or less, when the sector normally commands a multiple several times higher [6]. Ron Eliasek, chairman of Global TMT investment banking at Jefferies, noted that “valuation benchmarks from peer companies, such as revenue multiples, are moving too quickly for either side to anchor a price” [6].

: The discrepancy between elevated private market valuations and compressed public market multiples remains a structural challenge that could delay the IPO recovery timeline. Investment bank Goldman Sachs projected double the 2026 IPO count to 120 deals, but the current volatility and valuation concerns may challenge this outlook [1].

: Clear Street served as underwriter for multiple crypto treasury capital raises, particularly Strategy’s offerings. The sharp decline in crypto markets affected sentiment toward the company’s IPO [3].

: The emergence of “agentic” AI architecture has created uncertainty around traditional software business models, with companies like Oracle seeing valuations nearly halved from October highs [7].

• Market Volatility
  : Elevated – NASDAQ down 4% in recent weeks [0]
• Sector Valuation Pressure
  : High – Software stocks at approximately 1x forward revenue versus historical multiples
• Investor Sentiment
  : Weak – Recent IPOs underperforming significantly
• Crypto Market Contagion
  : Moderate – Affecting related financial services companies

• Sector Rotation
  : Utilities (+3.59%) and other defensive sectors have outperformed technology (+0.008%) [0], potentially attracting capital away from tech
• Alternative Listing Pathways
  : Companies may explore direct listings, SPACs, or deferral rather than traditional IPOs
• Valuation Reset
  : Once market stabilization occurs, companies that list during this period may benefit from less competition for investor attention

1. Federal Reserve policy trajectory and interest rate impacts on growth stock appetite
2. Software sector stabilization pace and depth
3. Q1 2026 earnings season for valuation benchmark setting
4. Private market valuation versus public market compression gap

The IPO market slowdown in early 2026 reflects broader market dynamics: a prolonged software sector correction has compressed valuations, making it difficult for companies to price IPOs appropriately. The postponement of prominent listings like Clear Street and Liftoff Mobile, combined with the underperformance of downsized offerings like Agibank, illustrates the challenging environment for new public offerings. Market participants should monitor the technology sector’s stabilization, upcoming earnings seasons, and any policy developments that might shift investor appetite for growth equities. The Goldman Sachs projection of 120 IPOs for 2026 may need revision given current market conditions.