One of the trends we’ve been tracking here at Top Tier is what we like to call the rise of the “Private Company IPO”. The Private Company IPO reflects the upsurge of rapidly growing “unicorn” companies with $1B+ private valuations raising increasingly large growth rounds. These rounds play a dual role: providing working capital to the company, and providing liquidity to employees. These companies are operating at large scale with 500-2000+ employees and rapidly growing year-over-year revenue figures, and are operating near or at negative free cash flow. Companies use ‘Private IPO’ capital not only to fund their business, but also to provide periodic buybacks for employees. This helps the company manage its capitalization table while helping employees to realize capital gains on their illiquid shares. We believe both these liquidity options are reminiscent of uses of proceeds for public market IPOs in the 1990s. Per PitchBook, the number of US private unicorns has increased dramatically since 2014 to over 138 as of August 2018.