US IPO activity posted a modest improvement in 2024, as the number of new deals priced during the year rose 39% when compared to 2023. In addition, new cash raised in 2024 surged 53% when compared to the previous year. Despite these gains, overall U.S. IPO activity was weaker in 2024 than seen on average over the past ten years.
2024 U.S. IPO Activity
According to Renaissance Capital, one hundred fifty (150) new deals were priced in 2024 representing a 39% increase from the 108 deals that were priced during 2023, and a 111% gain from the seventy one (71) new deals priced during 2022. Despite this increase, the number of new deals priced in 2024 remained 13.7% below the average number of new deals priced during the past ten years.
As you can see from the chart below, the volume of new capital raised in 2024 totaled $29.6 mln, 52.6% above the $19.4 mln that was raised during 2023, and 284.4% above the $7.7 mln in new cash that was raised in 2022. The amount of new cash raised in 2024 was 34.9% below the average annual amount of new cash raised over the past ten years.
Two hundred nineteen (219) new IPOs were filed during 2024, a 19% rise from the one hundred eighty four (184) deals filed during 2023, and 52.1% surge from the one hundred forty four (144) deals filed during 2022. As mentioned previously, 219 new deals were filed in 2024 – 4.2% below the 228.5 new deals filed on average over the past ten years.
The US IPO market was much weaker than the overall equity market during 2024 as the Renaissance IPO Index rose 16.4% during the year compared to the 25.00% increase for the S&P 500 Index during the same period.
Our Take
US IPO activity recorded modest strength during 2024, as most IPO metrics moved higher when compared to the depressed totals posted in 2023. Despite this performance, US IPO activity in 2024 remained weaker that the average IPO activity seen over the past decade.
In our view, U.S. IPO activity is likely to improve in 2025, especially if the Federal Reserve continues cutting interest rates during the year boosting performance in the overall stock markets. This should create market conditions where CEOs gain confidence that the equity markets should rise for most of the year, a view that will encourage many of them to engage in more strategic growth initiatives requiring additional capital. Many industry analysts also suggest that IPO activity is likely to improve as a result of public companies’ need for funding following weakness in the equity capital markets over the past few years.
Consistent with these trends, we expect that many investment banks and independent research firms will increase their hiring of equity research analysts and salespeople in 2025. This is due not only to a projected rebound in the US IPO market, but also to the proposed reversal of MiFID II research payment restrictions in the UK and Europe that took place in latter half of 2024.