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Summary:

Clearwire pulled back its IPO plans yesterday, and turned to the more generous and less demanding private sector, scoring more than double what it planned to raise from the public markets. It was a smart move in the light of the sorry state of tech IPOs. […]

Clearwire pulled back its IPO plans yesterday, and turned to the more generous and less demanding private sector, scoring more than double what it planned to raise from the public markets. It was a smart move in the light of the sorry state of tech IPOs.

Despite a sense that tech IPOs are returning in certain sectors, the public markets are still tepid for the most part. Everyone knows the Vonage story. Likewise Omniture, a web analytics firm inched down on its first day in the public markets, and network processing comany Wintegra pulled its IPO plans in the final hour last month. Yesterday telecom hardware maker ECI Telecom, a substantial company with big revenues, withdrew its IPO. It makes you wonder about the prospects for companies like Acme Packet, which has filed to go public as well. What about Optium?

According to a report released yesterday by the National Venture Capital Association, tech IPOs rose significantly in the second quarter of the year, but are still pretty tepid. NVCA President Mark Heesan, puts it as, “The growth in tech IPOs is encouraging, but we are certainly not out of the woods yet. We will need to see those levels increase throughout the rest of the year to characterize the U.S. public markets as available to venture backed companies.”

There are quite a few stellar technology companies waiting in the wings for the IPO window to open up. Force 10 Networks and Infinera come to mind. Tell Me Networks is another mature company that could tap the IPO pump. But if Clearwire is any indication, they will all have to wait.

Update: ECI wasn’t planning an IPO, or probably any other offering for that matter. They have long been a public company. They renewed a shelf registration recently, and got clobbered by rumors they were planning an acquisition.

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  1. Acme Packet’s prospect is all the more interesting to watch, in light of Netrake’s exit and Newport’s recent performance.

  2. Jesse Kopelman Friday, July 7, 2006

    I think in the case of Clearwire, cause and effect are being reversed. They didn’t stop the IPO because it was too risky, they stopped it because they got a better offer from a private investor — Intel.

  3. Are Tech IPOs on the Upswing?…

    Sure looks like it from Paul Kedrosky’s analysis: But given that some high-profile companies such as Clearwire didn’t go out, it still might be a little early to tell how sustainable the resurgence is…

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