Ebb & Flow

What happened to all of the window-wishers; those who would run around even in the worst of bear markets predicting that a robust IPO window is just around the corner? Even with a slate of solid IPO candidates presenting at last week's Future Leaders in the Biotech Industry conference in New York, there was hardly a peep about the "IPO window" returning.

While a curmudgeon may say it is a sign of how bad things really are on the public equity front, perhaps it's an indicator that private companies are finding the venture taps open, and thus are less concerned about an immediate opening of the window. Venture money is getting deployed at a record pace this year, even ahead even of the bubble year of 2000. In the first quarter alone, private biotech companies raised $840 million worldwide, more than the $731 million raised in the first quarter of 2000, and the $773 million raised in the first quarter of 2001.

Well-fed companies also could lead to a new phenomenon: longer troughs between IPO windows. More and more, private companies are telling Ebb & Flow that they are in the catbird seat in terms of choosing when they want to do an IPO, rather than having their balance sheets choose for them.

Although it is impossible to draw hard conclusions from two data points, there were 34 months between the end of the '91-'92 IPO window and the start of the '95-'96 window. The '99-'00 IPO window didn't crack open for another 38 months.

Each window lasted about one year; however, the '99-'00 window differentiated itself as companies raised more than three times that of the prior two windows - $97.2 million on average - and commanded nearly a four-fold increase in valuation - $422 million on average (see BioCentury, April 16, 2001).

Hot names

If there's any appetite for new paper, a packed room at Future Leaders boded well for Cytokinetics. Market watchers have tipped the company as a top IPO candidate because

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