In recent years, we’ve witnessed a troubling trend in the micro-cap IPO market. Despite the majority of IPOs raising less than $15 million in 2022, 2023, and so far in 2024, the average deal sizes are consistently shrinking. This decline, coupled with the volatility and significant price spikes immediately post-IPO followed by sudden drops, is raising major concerns for investors, exchanges and companies.
📉 **Why It Matters:**
– **Investor Protection:** The current infrastructure leaves investors vulnerable to sharp price fluctuations and potential losses shortly after investing.
– **Market Confidence:** Sustained volatility can erode trust and deter potential investors from participating in future offerings.
– **Capital Formation:** Smaller deal sizes may signal underlying issues in the market’s ability to support growing companies effectively.
📝 **Opinion Paper:**
This short opinion paper examines the systemic issues plaguing the micro-cap IPO landscape and proposes urgent reforms to stabilize and restore confidence in this vital market segment for micro cap companies.
It’s time to take action and ensure a robust, transparent, and fair market for all stakeholders. Your insights and engagement are crucial as we navigate this challenging landscape together.