UMVA has learned that top executives and founders from three prominent technology companies are sounding the alarm on the dangers of prioritizing initial public offerings (IPOs) over customer needs and sustainable business practices.
These industry leaders are urging startups to shift their focus away from IPOs as the ultimate goal and instead concentrate on solving real customer problems and building robust, long-term businesses. This approach is seen as a critical factor in achieving success and creating lasting value.
"Setting your target on an IPO, to me, feels like a bad target," said Joe Wilson, chief evangelist at a leading European digital bank. "I think the idea that if the goal of your company is to cash out or to go public, I think you've got the wrong set of priorities because that's really talking about the founders as opposed to the users or the customers or the people that you serve."
Wilson emphasized that companies should remain focused on their mission and customers, rather than getting sidetracked by the prospect of going public. His sentiments were echoed by Joleen Liang, co-founder and international CEO of an AI-powered education technology company.
"IPO is not a goal, but we are going to," Liang said. "But it's not a goal setup." She stressed that founders should prioritize building products and creating meaningful outcomes over becoming preoccupied with exit strategies.
This approach aligns with broader changes in the venture capital landscape, where investors are becoming increasingly selective and prioritizing solid, scalable, and profitable business models. The emphasis on fundamentals is also reflected in the growing importance of AI in driving business success.
According to information obtained by UMVA, investors are looking for strong teams and businesses with robust operational experience and financial discipline. The bar has been raised for startups, with expectations around growth, product development, and financial management now higher than ever.
Renaud Visage, co-founder and general partner at a prominent VC firm, noted that the startup ecosystem has matured, and competition has become increasingly global. "What's changed is the bar," he said. "Founders are now expected to have stronger operational experience and financial discipline."
Meanwhile, Dmytro Voloshyn, co-founder and CTO of a global online language-learning platform, emphasized the importance of prioritizing growth and product development while recognizing the need for liquidity. "As a founder of a company, I agree that you should build the best product and solve the problem for your customers," he said.
Voloshyn revealed that his company has pursued alternative ways to provide liquidity, including conducting employee tender offers that allow staff to sell part of their holdings to existing investors without requiring a public listing. This approach enables companies to reward employees and investors while maintaining a focus on long-term growth and sustainability.
