As much as USD 35bn may be raised in initial public offering proceeds on the US exchanges this year, Deloitte capital markets transactions leader Will Braeutigam told this news service, as issuers hungry for capital look to tap the markets.

The figure could tower over the USD 20bn raised in 2023 and is not far from the average of USD 40bn raised in an average year in the last decade (excluding 2021), the partner said, citing an internal assessment carried out based on daily work with pre-IPO companies and his team’s analysis.

“2023 was the year when we were finally on our way there and we expect the situation to improve further this year,” the partner said.

The amount of fresh capital likely to be raised will set the market up for a positive 2025, he added, provided that market conditions remain stable. With the pipeline growing fast, he expects some companies will opt to go live next year rather than in 2024.

Braeutigam said the issuance window kicked off early this year, with IPOs coming to market including homebuilder Smith Douglas Homes [NYSE:SDHC], apparel holding Amer Sports [NYSE:AS], and KKR [NYSE:KKR]-backed BrightSpring Health Services [NASDAQ:BTSG]. At press time, Smith Douglas’ stock was trading 15% above its debut price, Amer Sports was down 3%, and BrightSpring Health was up about 2.5%.

Braeutigam cited high demand for capital as the reason for Deloitte’s IPO projection. Many companies are in expansion mode and when considering the cost of capital, management teams and sponsors would rather tap equity than expensive debt, he noted.

“Every company will have a slightly different story as to why they are raising capital, but demand is very high and possibly higher than the supply,” he said.

This means that companies who have been ready for a while should opt to kickstart their launches as early as possible, with Braeutigam anticipating it will be harder for those joining the “huge line” too late in the year.

The pipeline includes both companies who have already publicly filed paperwork with the Securities and Exchange Commission and others who are quickly pursuing plans.

Circle Internet Financial, the Boston-based issuer of the USDC stablecoin, announced recently that it had confidentially filed paperwork with the SEC for an IPO, while Dallas-based clearing firm Apex Fintech Solutions said so late last year.

Meanwhile, Lineage Logistics, a Novi, Michigan-based cold storage and logistics solutions provider, is preparing for a listing at a reported valuation of more than USD 30bn. Astera Labs, a Santa Clara, California-based connectivity solutions provider for intelligent systems, is also reportedly preparing for an offering in 2024 with retained banks. This news service previously reported that Loar Group, a New York-based firm that specializes in the production of niche aerospace and defense components, is considering an IPO later this year.

“The companies going earlier will have more time and scope to raise,” he said.

Braeutigam says it is vital to have a strategy as market windows are unlikely to be open throughout the earnings period, with bursts of activity still expected to be the norm as opposed to a continuous flow.

The improved prospects could set the stage for a 2025 that he is confident will outshine the drought of the past few years due to the sheer amount of recent filings, improved investor sentiment and willingness to deploy cash.

“There is clearly a thirst for capital,” he said.