(Bloomberg) — Companies looking to go public in the US before the Thanksgiving holiday seemingly got a boost when the market regulator made it easier for them to list as the government shutdown grinds on. Advisers say the path opened by the revised guidance isn’t likely to unlock more than a handful of listings.
In normal times, Ethos Technologies Inc. and crypto firm BitGo Holdings Inc. are among the handful of listing candidates that could’ve begun formally marketing their deals — a standard seven to nine day exercise that’s often tightly choreographed, with companies and their advisers in constant contact with the US Securities and Exchange Commission. With the SEC closed, companies have the option of choosing to have their registration automatically declared effective 20 days after launching, a lengthy wait time exposing them to a wide range of risks.
Most Read from Bloomberg
The SEC’s guidance Thursday appeared to address the issue, giving companies more flexibility around pricing by offering a price range in place of a fixed value. But even that may not be enough. So long as the 20 day waiting period remains in place, securities lawyers and bankers say few of the companies will likely take the SEC up on it.
“This gives the IPO market the ability to have a couple of trickles come out of the faucet, but the faucet’s not going to turn back on until the SEC is open for business,” said Keith Townsend, co-leader of King & Spalding’s global corporate practice. “This gives them a potential path forward that is executionable, but not ideal.”
Navan Inc. decided to take the plunge. On Friday, the company and some of its shareholders began marketing a listing that could raise as much as $960 million. Based on a 20 day wait, the travel software maker could go public as soon as the final days of October.
For others weighing a similar move, setting a price range nearly three weeks ahead of a debut may be deemed too risky — particularly in an environment where geopolitics threaten to trigger spikes in volatility, like on Friday when President Donald Trump’s promises of additional tariffs on China sent stocks lower.
A representative for the SEC didn’t immediately respond to a request for comment.
A prolonged shutdown would at least temporarily close off the standard route to an IPO for companies like Beta Technologies Inc., Once Upon a Farm PBC, and Wealthfront Corp. which have filed publicly and would have been positioned to launch their processes as soon as this week, with all the standard options available to them.
The current standstill comes against a backdrop where US IPOs have broadly been working for Wall Street. Nearly $35 billion has been raised through first-time share sales on US exchanges through Oct. 10, surpassing the total for last year, data compiled by Bloomberg. And they’ve performed well, with a weighted-average gain of about 37% from what IPO buyers paid, delivering three times the S&P 500 Index’s returns.
But the ongoing shutdown, combined with a potential need for fresh quarterly financial updates and a slate of holidays in the final two months of the year, combine for a cocktail of risks that could make the fourth quarter’s IPO volume into a huge disappointment.
In particular, companies with quarters that ended on Sept. 30 have just a few weeks before their latest financial results need to be replaced in the filings with fresh numbers. For such companies that planned to go public in October, the need for an additional audit will risk taking a pre-Thanksgiving IPO off the table, and cost firms time and money, according to John Kolz, Barclays Plc’s global head of equity capital markets.
“June 30 financials can only be used until November 12,” he said. “If you work back from there, that means you’d likely need to be on file publicly by October 16 to go before that audit is no longer sufficient.”
Kolz and other bankers referred to the latest guidance as a positive update from the SEC. While the softer restrictions on jamming through an IPO in the event the government stays shut into November open the door for a better route to public markets, teams are still taking each deal in stride, with an eye on the calendar.
“Anyone waiting for SEC comments or waiting to launch, it’s a day-to-day or week-to-week discussion around windows and financial staleness and hopefully that doesn’t turn into a protracted delay,” said Evan Riley, Americas head of ECM at BNP Paribas SA. “It’s more a discussion of when do we get into financial staleness, typical market slowdowns and a matter of windows.”
—With assistance from Lydia Beyoud.
Most Read from Bloomberg Businessweek
©2025 Bloomberg L.P.