"The key constraint is not issuance but establishing valuation frameworks that reflect how today’s companies are built and scaled," Curtis emphasised. This sentiment underscores the need for a more nuanced approach to IPOs, especially as companies increasingly mature in private markets before considering public offerings.

Curtis highlighted that a small group of large, complex IPOs, spearheaded by SpaceX, could redefine how public markets value innovation across sectors such as artificial intelligence (AI), infrastructure, and platforms. "When SpaceX goes public, it could mark an important inflection point: resetting how public markets value a new generation of companies that were built and scaled in private," he noted.

This potential shift in valuation frameworks is not just about recognising the size and complexity of these companies but also understanding the new dynamics of value creation. "Value creation has shifted. With more value realised in private markets and companies entering the stock market later, differentiation is increasingly driven from understanding businesses earlier, not simply accessing them at IPO," Curtis explained.

The current cycle of IPOs is markedly different from previous ones. Curtis pointed out, "One of the most important shifts we’ve observed over the past decade is where value is created. Innovation, particularly across AI, software and tech infrastructure, is increasingly developed and scaled in private markets." This evolution means companies are reaching significant milestones, such as refining business models and achieving profitability, before ever considering a public listing.

This trend has implications for both private and public markets. "Private markets have funded and scaled much of the current innovation cycle, while public markets have had to interpret that progress with less direct visibility," Curtis observed. He added that as these companies list, they will contribute to a more complete picture of how innovation is priced across different parts of the technology stack.

Curtis also touched on the broader market implications of this shift. As these emerging leaders enter major equity indexes, the composition of benchmarks like the S&P 500 and MSCI World is expected to evolve. "Benchmark composition should evolve alongside the innovation cycle. As emerging leaders enter major equity indexes, benchmark composition will likely shift, reshaping sector weights, growth profiles and the characteristics of technology allocations themselves," he stated.

Understanding companies earlier in their lifecycle is becoming increasingly important in this new environment. "In our view, this reinforces the importance of understanding companies long before they become widely held in public markets," Curtis said. This early insight can differentiate between short-term valuation adjustments and fundamental shifts in business quality, offering investors a strategic advantage.

Investing in both public and private markets is crucial, as it allows for a more comprehensive understanding of companies. "Much of the insight that informs our public market views comes from observing companies earlier in their lifecycle around how they scale, where demand is forming and how business models evolve," Curtis noted. He cited the firm's experience with private companies like SpaceX, Databricks, and Anthropic as reinforcing this perspective.

Looking ahead, Curtis anticipates a selective phase of IPO activity. "While there is a meaningful pipeline of companies, we expect the next phase of IPO activity to be selective. Companies will need to demonstrate scalability and durability, profitability and earnings visibility will matter more, and valuation discipline may be higher across public markets," he predicted.

Rather than a broad reopening of the IPO window, Curtis envisions a more measured transition. "We expect a gradual increase in IPO activity, a clearer alignment between private and public valuations, and a more selective environment overall," he concluded.

As the IPO market prepares for potential transformations, Curtis's insights offer a roadmap for navigating this evolving landscape, emphasising the importance of pricing strategies that reflect the realities of today's business environment.