Distributions are coming

Pitchbook published data that VC distributions in 2023 were a 14 year low. That’s the lowest level since the great financial crisis. That’s no surprise to anyone that follow the space as there were more tech IPOs in 2008-2009 than there were in 2022-2023.

There is a severe lack of liquidity in the private markets right now. Founders and employees are starving for liquidity as well as LPs who invest in VC funds.

The only thing that can really jumpstart things is the IPO market opening back up. Luckily, we’re starting to see indicators that 2025 will be a better year for the IPO market.

ServiceTitan filed their S1 a few days ago and expects to go public in the next coming few weeks. We’re hearing that many will watch closely and hopefully follow behind them.

This feels a bit like 2020. In 2020, we saw the elction get past us and then a few tech companies such as DoorDash and AirBnb go public in December. That opened the window and a ton of companies went public in the following year.

Of course, 2020 was a different day and age. COVID was still a thing and interest rates were nearly 0. No one expects a mad rush like it was in 2020, but the consensus is that the window will open and liquidity will start flowing again. Let’s hope for the best.