Both Lyn and I were doing this before we came on. This is my Bloomberg app. There's a fair amount of red. We're down about nine-tenths of a percent on the major averages. It was a little bit worse before. I was thinking about two years ago, we were on the Invest stage and the title of our discussion was 'Marketing Chaos.' Are we in marketing chaos right now? No, markets go up and markets go down. Today it's going down, yesterday it went down, but remember that the S&P and the Dow in particular are still above the pre-election level. There was a big euphoria that occurred post-election day in the market, which was maybe overdone at that point. Potentially. Markets recalibrate.
I was thinking about yesterday. CoreWeave, backed by Nvidia, a cloud computing provider, filed for an IPO. Bloomberg reporting it could raise $4 billion from the listing. It's expected to target a valuation greater than $35 billion. We are expecting a wave of potentially sizable listings this year. On a day when the market sold off, it was the worst sell-off so far this year. What was more interesting to you, the sell-off or the CoreWeave listing?
What you will see now is companies start to flip public, but it's a timing thing. What most people don't appreciate is, if you're a private company, your financials go stale at some point, so you need to restate financials. That happens between mid-February and the end of February when you get your audited financials for the previous business year. So I anticipate, based on our pipeline, we're going to start to see some companies flip public. We had one flip public called Mountain on this past Friday.
Are you hearing from companies? You're busy?
Yeah, we are busy. We are busy, not just from the perspective of working with our pipeline to get them out the door, in execution mode, but also we're very busy in terms of pitches. Companies are making plans for more like second half of the year. Sizable ones, smaller ones, a mix of both.
Are you worried though about our world, day to day, where whatever comes out of Washington, whatever executive order, whatever press event happens from the Oval Office, moves markets? Are you concerned about what you're hearing now and what seems to be optimism for IPOs that could get derailed?
The only way that I think it's going to get derailed is if the volatility in the market becomes outsized, and I don't think it'll get derailed. We've moved up a little bit, but VIX around 20 is still fine.
Is there something that the president could do?
I don't know. He seems to be very focused on three key areas, or this administration's focused on three key areas: border security, resolving the wars that have sadly overtaken other nations, and our economy. What you're seeing right now is the confluence of all three come into the fore and start to affect policy. It's a lot.
What about the rate environment? We have seen the US Treasury curve move down significantly. It's been interesting the last few days. If we see that move down, there's a couple of scenarios. Moving down without a recession is better, especially for the IPO market. Tell me some of the other factors that you think about that will determine what happens this year.
Well, if you also look at the rate environment, it's going to affect mortgages, it's going to affect loans, it's going to affect other parts of the ecosystem. You look at the bank stocks, for example, they're doing quite well at the moment. That's probably more to do with promises on the regulatory side as opposed to the interest rate side. But there are a variety of other parts of the ecosystem that would benefit from a lower rate environment, so we'll see.
What do you think about the private equity world in terms of finally looking to spend out some of their investments? It's not been an easy environment. We know Carlyle telling Reuters yesterday they're looking for $4 billion worth of investments coming out. What are you hearing or what are your expectations? Do we finally see some of the private equity investors either IPO or selling assets?
We've seen a couple of sponsor-backed deals go out last year. Actually, StandardAero was one that did particularly well. That was a Carlyle deal that did particularly well in October of last year, north of a billion, and trading really well in the secondary market. I think the more deals that get done at good valuations and raise good amounts of capital and then importantly trade well in the secondary market given the liquidity and demand from investors, you'll start to see some of the sponsors start to float their aged assets or look to the M&A markets. So it's not just about IPOs. This administration's also promising a more favorable M&A environment, which is another area that's attractive to sponsors.
Lyn, one thing I want to ask you. The NYSE IPO index is down about 5% as of yesterday's close. Bloomberg reporting a couple of weeks ago how three of the US's four largest IPOs this year have traded below their offer price in their first session. Many would consider it's been quiet. Does that tell you they shouldn't have gone public, they went too soon?
