Demand-Side Of IPOs

Earlier this month Rick A. Fleming, Investor Advocate at the Securities and Exchange Commission, gave a speech in which he discussed the impact that shrinking public markets have on investor participation.  Mr. Fleming noted that over the past 20 years, the volume of initial public offerings (IPOs) has been decreasing and companies are waiting longer to go public, limiting the ability for individual retail investors to participate in capital growth and preserving capital gains for wealthy investors in the private markets.  He also noted that there has been a significant shift away from retail investing towards institutional investing.  Mr. Fleming explored whether there is a link between the shift to institutional investing and the decrease in IPO activity, specifically with regard to small company IPOs.  Based on discussions with asset managers, Mr. Fleming discovered that, in general, institutional investors who engage in active management have little interest in