By Steve Gelsi
After Figma’s stock set a record for a first-day post-IPO gain, D.A. Davidson listed companies that could speed up plans to go public
The record first-day rally in design-software company Figma Inc.’s stock earlier his week hammered home the point that investor demand for initial public offerings is red-hot.
“There are a lot of private software company candidates that will look to go public over the next 12 months if the IPO market is as strong as it looks,” Gil Luria, head of technology research at D.A. Davidson, wrote in an email to MarketWatch.
The Renaissance IPO exchange-traded fund IPO has run up 17.6% over the past three months, while the S&P 500 index SPX has advanced 11.3%.
Read: How Figma’s soaring stock made for a historic IPO – and what may come next
Among the largest private software companies, Canva LLC, which is also in the design-software arena, and Databricks, a data-analytics company, could look to ride the IPO wave sooner rather than later, Luria told MarketWatch.
Luria’s list of potential IPOs also includes business-process-software company Celonis and payroll-software company Deel.
“In terms of big ones coming soon, I do think Databricks is top of the list and Canva is very possible,” he said.
Canva Chief Executive Melanie Perkins has mentioned the possibility of going public but has not put out a timetable.
Late last year, the company hired Kelly Steckelberg – who was the chief financial officer of Zoom Communications Inc. (ZM) when the video-conferencing company went public in 2019 – to be its CFO, seen by some as a sign of IPO plans.
Canva and Databricks have not responded to requests for comment.
Another company Luria believes could look to jump on the IPO bandwagon is Genesys. On Thursday, the provider of artificial-intelligence-powered customer-experience software announced a $1.5 billion combined investment from Salesforce Inc. (CRM) and ServiceNow Inc. (NOW).
Fintech Klarna Group Plc, which provides buy now, pay later options, filed for its widely anticipated IPO on March 14 but has yet to set terms. The company’s private-market valuation was recently about $14 billion, according to Forge Global.
The 10 biggest private companies
Databricks and Canva also appear on the list of the 10 largest private companies with large institutional investors.
Elon Musk’s SpaceX tops the private-market list with $408 billion in enterprise value, followed by TikTok owner ByteDance with a $351 billion valuation and Chat GPT originator OpenAI with a $312 billion valuation, according to the PM Insights list of private companies as of July 21.
Financial technology company Stripe ranks fourth on that list with a $98 billion valuation, followed by Musk’s xAI at $90 billion and Anthropic, an AI systems specialist, at $83 billion.
As for SpaceX, there’s been talk of a spinoff of its Starlink satellite internet service, but Musk has not confirmed plans for IPOs for either business.
Of the five most valuable private companies, one of them – OpenAI -has broached the possibility of an IPO, but none have filed to go public.
Also read: SpaceX’s $350 billion private valuation signals an IPO is off the table for now.
Private-markets platform Forge Global said larger private companies with valuations well into the billions of dollars that are already making moves toward public markets include aerospace and defense company Anduril Industries, ticket seller StubHub and Brex, a digital bank.
These companies grew larger with capital from institutional money in private markets as less favorable IPO conditions took hold over the past several years.
Those institutional investors will want to be paid back at some point, and now that public markets are becoming more favorable, they may start pushing for exits by selling shares of these now-mature companies to public-market investors.
That was the path taken by Figma, which raised $1.2 billion with its IPO and saw its market capitalization rocket to $67.6 billion at the close of its first day of trading. Selling shareholders include affiliates of venture-capital firms Kleiner Perkins, Index Ventures, Greylock Partners and Sequoia Capital.
Market conditions have been changing rapidly this year, with worries about the economy and U.S. trade relations sparking volatility, and the IPO window could slam shut if that volatility persists.
That could push companies to speed up IPO plans before sentiment sours again.
-Steve Gelsi
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08-01-25 1651ET
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