The IPO market has tightened, pushing many midsized firms into a liquidity maze, writes Shawn Bercuson, Earlyasset founder. Over the past three decades, the revenue bar for listings has doubled, leaving companies that once thrived on public markets now trapped offline. Recent high‑profile IPOs by SpaceX and OpenAI mask this structural shift for investors and businesses to understand the implication.

Bercuson points out that 1996 saw over 8,000 U.S. firms listed, while today fewer than 4,000 do, despite the economy tripling. The median IPO now requires revenue that would have classified a company as mid‑cap a generation ago, pushing many with $50‑$200 million in sales to remain private for years and investors face delayed returns as the market contracts and liquidity options dwindle for smaller firms while larger players benefit from higher valuation thresholds and sustained investor enthusiasm.

Employees at these firms have traded lower pay for equity, expecting a public exit. Without a functioning secondary market, options trigger costly taxes and illiquid shares. Bercuson cites Caplight data showing 90% of venture secondary volume last quarter concentrated in 15 companies, leaving the rest with a broken market and investors must seek alternative liquidity channels or accept prolonged uncertainty.

Bercuson's comparison to the 19th‑century curb market suggests a similar evolution: informal trades will eventually formalize into a robust secondary exchange. Until then, shareholders bear the cost of delayed exits, and venture capitalists face lower DPI from locked‑in portfolios. The market’s future hinges on building infrastructure that can match the demand for mid‑cap liquidity and investors adapt accordingly.