eToro's Successful IPO Signals Renewed Momentum in Tech Markets

The tech IPO market is finally showing signs of life after an extended drought that began in early 2022. Recently, there have been several encouraging developments, starting with the successful debut of eToro, a stock brokerage platform based in Israel. On May 15, 2025, eToro’s shares jumped nearly 29% on the Nasdaq, pricing above the expected range. This positive performance comes amidst a broader trend where companies are regaining confidence in the market. Another notable success is CoreWeave, an artificial intelligence (AI) infrastructure provider. CoreWeave’s shares have surged about 60% this week and doubled in value since its March IPO. In its first earnings report as a public company, CoreWeave announced a 420% revenue growth, far exceeding analysts' estimates. These figures indicate strong investor interest in AI and technology-driven sectors. However, the journey to this point has been tumultuous. Early in President Donald Trump’s second term, optimism about a reinvigorated IPO market was marred by the rollout and subsequent pause of sweeping tariff policies in April. This led to significant market volatility, causing companies like online lender Klarna and ticket marketplace StubHub to delay their IPOs. According to the National Venture Capital Association (NVCA) and PitchBook, exits for venture firms in the first quarter reached their highest value since the fourth quarter of 2021, with nearly 40% of that value coming from the CoreWeave IPO alone. Despite these challenges, the second quarter is seeing a resurgence. eToro, which had previously put its plans on hold, successfully completed its IPO, potentially encouraging other companies to resume their journeys to the public market. The focus is now turning to the digital health sector, with Hinge Health, a virtual physical therapy company, being closely watched. Hinge Health updated its prospectus this week with an expected pricing range of $28 to $32, valuing the company at about $2.4 billion. However, the digital health market has struggled since the surge during the COVID-19 pandemic, when consumer and patient preferences shifted heavily toward virtual solutions. Growth in this sector has since slowed significantly. Conversely, the AI sector continues to perform well. Cerebras Systems, a chipmaker renowned for its advanced AI processors, filed for a public listing in September but faced delays due to a review by the Committee on Foreign Investment in the United States (CFIUS). Cerebras CEO Andrew Feldman recently stated that the company aims to go public by the end of the year, now that it has received the necessary clearance from CFIUS. Additionally, Galaxy Digital, a digital assets company, switched its trading venue from the Toronto Stock Exchange to the Nasdaq on May 16, 2025. Galaxy CEO Mike Novogratz noted that the move will help the company attract a broader investor base. Founded in 2013 and headquartered in New York, Galaxy Digital has a robust presence in the cryptocurrency space, having initially gone public in Canada in 2020 when U.S. regulators were cautious about crypto companies. For the tech IPO market to truly rebound, more large-scale, growth-oriented companies need to enter the fray. Despite the recent positive trends, the market remains cautious due to the inherent risks associated with IPOs. "The IPO market might be one of the latter ones to return as the market starts to recover, just given the risk around IPOs," remarked John Gerring, managing director of equity capital markets at Goldman Sachs. Nonetheless, Gerring noted that the current trajectory is moving in the right direction, indicating a cautious optimism among industry insiders. These successes are seen as crucial indicators that the tech IPO market is beginning to show resilience and adaptability. Companies like eToro and CoreWeave are setting benchmarks, proving that even in a challenging economic environment, well-positioned tech firms can attract significant investor interest. The broader implications suggest a potential uptick in IPO activity across various tech sectors, fueled by the growing appetite for innovative and growth-oriented companies. With further regulatory clarity and sustained market stability, the tech IPO landscape could see a robust recovery in the coming months. Industry insiders and analysts remain cautiously optimistic about the future of tech IPOs. They note that while the market still has hurdles to overcome, the successes of recent IPOs and the strong performance of companies like CoreWeave and Cerebras bode well for the sector. These firms have demonstrated that they can navigate complex economic and regulatory landscapes, which is likely to boost investor confidence. The National Venture Capital Association and PitchBook's reports highlight the importance of market conditions and regulatory reviews in shaping the trajectory of tech IPOs. As more large and innovative companies consider going public, the tech ecosystem stands to benefit from increased liquidity and investment opportunities.