Venture capitalists in Silicon Valley are poised for a fresh wave of tech IPOs, while Chinese tech start-ups eye the global market.

Private investors in Silicon Valley bet on the nascent tech companies they back eventually going public or being sold for vast sums. In recent years they have made impressive gains on paper, but few have cashed in, as stars like Uber and Airbnb have amassed astronomical valuations while remaining private. Investors’ patience may soon be rewarded. Analysts, bankers and investors expect a wave of initial public offerings to bring some of the most highly valued firms to the public market over the next 18 to 24 months.

Tech sector IPOs are already off to a strong start this year, with file hosting service Dropbox and streaming service Spotify, based in Sweden, successfully going public in March and early April, respectively. Tech IPOs in the US have raised more than $7 billion so far this year, surpassing all of 2015 and 2016, and more than half of the $13 billion they raised in 2017, according to the market-data firm Dealogic.

IPOs appear imminent at some of the most well-known privately held American tech companies. Uber Chief Executive Dara Khosrowshahi said he plans to go public next year with his company, currently valued at $68 billion. Rival ride-hailing company Lyft has been in talks with investment banks. Airbnb has started appointing independent directors to its board, offering another signal that an IPO is in the works.

In terms of human capital, there is a cyclical flow of talent at play behind such a wave of tech IPOs. Once start-ups go public and their executives and engineers gain wealth, they could leave to begin start-ups of their own. “That gives venture capitalists a fresh set of companies to invest in, renewing the cycles of innovation and experimentation”, according to the New York Times.

Start-ups have been able to gain abundant private capital without going public, but several things are driving them to do so now: Public investors are eager to get their share, and early employees want to cash in. Start-up executives may be keen to prove themselves as chief executives of public companies. IPO analyst Matthew Kennedy thinks nearly all private companies valued at more than $1 billion could go public in the next two years. He expects more immediate activity among mid-sized tech start-ups.

The stars are aligning similarly in China, where Kennedy says big private tech firms may also be nearing IPOs. Among the most highly anticipated Chinese IPOs are ride-sharing service Didi Chuxing, electronics maker Xiaomi, merged e-commerce site Meituan-Dianping, and ByteDance, a news aggregator. Valuations are sky-high: For example, Xiaomi is valued at $46 billion, and Meituan Dianping is valued at $30 billion. According to a 2017 report from Thomson Reuters, China has led the world in IPO market share since 2014.

The tech sector will be especially important this year. “Tech companies in China have developed rapidly in recent years, benefiting from various [government] initiatives, such as ‘13th Five Year Plan,’ ‘Internet Plus,’ and ‘Made in China 2025”, said Paul Lau of KPMG China. “Recently, we’re witnessing high levels of oversubscriptions for IPOs from the ‘new economy’ sector. This reflects the market’s confidence in China’s increasing efforts towards innovation and technology”, he told Tech in Asia. And, going public overseas offers massive valuations and international exposure.

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