The years of excess capital has continued to see money deployed in many asset classes which have provided plenty of great exits for startups. Most have been smaller relative to the Companies that have gained popularity on their disruption, innovation and growth. With some of those coming to markets soon, I have begun to wonder if it could lead to potential runs on Private Equity capital which could dry up as trillions of dollars could find themselves back on the public markets.
I think this Summer will prove this out as the expectation is that huge IPOs will come to market. It could also mean the proverbial top to a bubble that has raised valuations to highs not seen since previous bubbles that have popped and led to severe declines. Given how the money supply has grown since the last bubble, we really do not know how the markets will remain stable if a severe decline occurs. Recent one have been fast and sharp only to rebound but I wonder what happens if there isn’t enough capital to buy the dip.