In 2024, I had all sorts of funky metaphors for the stagnant IPO market, from "bathtub that wasn’t draining" to a tangled garden hose.
At a stalled time for IPOs, most of my metaphors were bleak. But one wasn’t—it came as I wrote about cybersecurity company Rubrik, which went public in April. Watching Rubrik CEO and cofounder Bipul Sinha, his family, investors, and colleagues on the floor of the New York Stock Exchange, it occurred to me that an IPO is like a wedding. It’s both a celebrated endpoint and the first day of the rest of your life.
The metaphor has aged rather nicely. Talking to Sinha in December, we touched on the "rites of passage" in his first eight months as the CEO of a public company, like his first-ever earnings call. Generally, these analyst calls are very controlled affairs, scripted as much as possible. It was a reality that bumped up against Sinha’s instincts. He’s not a canned statement kind-of-guy and is much more at ease just…talking.
"I'm more of an intuition person," he told Fortune. "So, when I'm talking to you, I'm not coming up with a prepared statement…We are talking and I'm thinking, and I’m going to give you a response in real time."
It seems obvious enough, but an in-the-moment communication style can easily bump up against the set-in-stone expectations Sinha now has to meet as a public company CEO. Startup founders who go public are rare, and even rarer is a founder who holds on to become the CEO of a listed company—and those who make it adapt exquisitely. A question Sinha’s been asking himself: "How do you create a balance between what people are looking for as an answer, and what you want to express as the leader of this newly-minted public company?"
He may still be figuring out how to balance his instincts with his new reality, but things seem to be going well. Since April, Rubrik’s shares are up about 75%, as of market close yesterday. Rubrik’s success is coming at an intense, busy time in cybersecurity, one in which the general public is perhaps more aware than ever of the sector. In part, that’s a byproduct of high-profile 2024 events, like CrowdStrike’s seismic IT outage, which Sinha says demonstrated the fragility of the digital economy. Lots of damage can be done in a world that’s rapidly becoming more connected, Sinha said.
"It’s kind of like driving a fast car," he said. "When you have a fast car, you better make sure that you have good brakes."
And cybersecurity, ultimately, comprises those brakes. It’s a sector that in recent years has garnered lots of attention from investors, as well as from acquirers. (Sinha isn’t looking at mega-deals at the unicorn level, but tells Fortune he’s in the market for tuck-in deals.) As 2025 gets rolling, Sinha is very optimistic about M&A, even beyond cybersecurity.
"The market is in a very good place with M&A, because a number of companies have gotten some scale, but they haven’t gotten to the scale velocity of being a public company," said Sinha. "If you look at the number of unicorns, there are 1,400, 1,500 unicorns out there. In a good year, 30, 40, 50 companies go public. So, not all of them can go public…As it’s dawning on the founders and investors of these businesses that they’re not going to grow into a public company, there will be lots of opportunities to do acquisitions."
The idea that reality is encroaching on dreams also comes up again in Sinha’s view of the IPO, the dream exit for many founders and investors. His take: The IPO market has been open since the back half of last year. There’s just one caveat: It’s a pragmatic and discerning IPO market, where companies need to be able to sell expectations that undeniably align with reality.
"The issue is that people have to accept reality," said Sinha. "In 2021, lots of people had very high valuations, and they’re not accepting the reality that those days are gone."
Or, put another way: "The IPO market has gone from being California to being Missouri," said Sinha. "It used to be 'tell me what you do.' Now, it’s 'show me what you got.’”
And that’s probably its own rite of passage—no more metaphors or ideas, just results. In the end, that’s what going public (and staying public) is really about.
ICYMI…Intel Capital, one of the most active, longstanding CVCs, is spinning off from its embattled chipmaking parent. In the second half of this year, the firm will become independent and get a new name. Any suggestions? Naming things is hard, let’s help ‘em out!
See you tomorrow,
Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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