The path to IPO for high-growth software companies used to feel as simple as shopping online, yet a turn in market fortunes in 2022 has left many European unicorns in limbo. But with interest rates peaking, and maybe falling soon, tech listings could be back on the agenda.

Since the IPO boom of 2021, European software companies have continued to attract significant private funding in their effort to disrupt tired industries, yet that has failed to translate into an IPO boom.

In 2021, European software publishers hit the jackpot with USD 21.34bn in deal volume across all global exchanges. In the past two years, deal volume has gone down to well under USD 500m, even though throughout the 2010s it stood comfortably between USD 5bn to USD 9bn.

This year European software IPO deal volumes YTD have been a mere USD 182m across just 10 deals, down from USD 249m over 25 deals at this point last year.

Advisers are lining up some names to lead a revival though. Hotelbeds investors Cinven, EQT [STO:EQT] and Canadian Pension Plan Investment (CCPI) are appointing banks to handle the Spain-based hotel room booking company's IPO, although they are still open to sell the business if a good offer emerges.

According to Mergermarket's Likely to Exit (LTE) predictive algorithm, Hotelbeds has a score of 76 out of 100.

But there is no guarantee of a return to prominence soon.

“Tech is a difficult category even though investors are starting to engage again with these equity stories both in the US and Europe,” one ECM banker said.

The failed IPO of Planisware, the France-based software publisher, is proof that market conditions are far from easy.

The French software company scrapped its listing during the autumn amid challenging market conditions, even though it was set to become the largest French IPO of the past two years.

Unique appeal and a disruptive business model are what many of these names still need to succeed in a tough IPO market.

Doctolib, the popular website and application for booking medical appointments in France, is one such name for example. Patients can message over 140,000 registered healthcare professionals through the app.

With its latest funding round in 2022, the company, which is backed by Eurazeo, Bpifrance and General Atlantic among others, reached a valuation of USD 6.4bn. Doctolib has a Likely to Issue (LTI) score, the metric applied to VC exits, of 64 out of 100.

The company is credited by one of the bankers with successfully addressing the heavy bureaucracy of the local healthcare system. “It is an example where digitisation has driven improvements in a sector and that has driven great returns,” another ECM banker said.

Doctolib might not hit the market until 2025, around the time when advisers in EMEA and the US anticipate a potential return of a tech IPO wave.

Similarly, Axel Springer [ETR:SPR], the listed German media company, is still working on the IPO of job portal Stepstone.

A longer-term candidate is Personio, a German human resources software firm, which won’t go public before 2025, CEO Hanno Renner recently said publicly. Personio has a LTI score of 26 out of 100.

Renner said he first wants to focus on further growth, development of its offering and customer satisfaction. Right now, Personio is valued at around EUR 8bn.

In the world of instant gratification technology has created, good things might be worth waiting for.

*Mergermarket's LTE predictive analytics assign a score to sponsor-backed companies to help track and predict when an exit could occur through M&A, an IPO, a direct listing or a deSPAC transaction.