Private market capital deployment remains subdued as venture capital firms enforce strict profitability metrics on late-stage software companies seeking liquidity.
The IPO Drought
Initial public offering activity remains well below pre-2022 historical averages, forcing non-profitable unicorns to seek recapitalization under unfavorable terms.
Structured Term Sheet Dominance
Investors are demanding liquidation preferences and ratchets to protect capital, creating significant downside risk for early-stage equity holders and non-executive employees.