The risks of being a publicly traded company have started to outweigh the rewards.
Venture capitalist and Netscape co-founder Marc Andreessen told CNNMoney that he wants the companies he invests in to wait until they are rock solid, both financially and technically, before going public.
While he didn't cite any specific risk, high speed computer driven trading and trading glitches have changed the landscape. Just last week an errant tweet sent stocks plunging for a few minutes before they bounced back. And last year, Facebook's botched debut resulted in big losses for some investors. The stock still hasn't fully recovered.
Andreeseen said that all of the companies he owns are waiting much longer to go public now than they would have just a year or two ago. Through his venture capital firm, Andreessen Horowitz, he owns stakes in AirBnB, Foursquare, Pinterest and Zulily, as well as Facebook (FB), where he also sits on the board.
For companies that do want to go public now, Andreessen advises to think twice about listing on the Nasdaq. He said he's not yet convinced that the exchange has fixed the technical problems that caused Facebook's first trading day to be such a disaster.
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Even private equity firms have been shying away from IPOs.
Private equity firms will often look for companies in industries that are about to take off and take them private in the hopes of earning back their investment and then some when they sell or take them public several years later.
Jonathan Sokoloff, a managing director at PE firm Leonard Green, said he's been witnessing the "creeping privatization of America's equity markets."
Speaking at the Milken Institute Global Conference Tuesday, Sokoloff said companies have also been using cash to buy back stock. So even those that are staying public are in some ways becoming less indebted to shareholders by keeping more of the company in private hands.
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If technical glitches like the recent Twitter-induced flash crash weren't enough to worry companies and shareholders, CEOs and corporate boards have also had to contend with activist shareholders, who are playing a greater role in pushing through changes in public companies.
"10 years ago, a CEO always wanted to know -- how do we get them away," Peter Weinberg, founder of the investment banking firm Perella Weinberg told an activist investing panel at the Milken conference:
Now, those same CEOs know they must engage and listen these shareholders. "Companies understand that they are owned by shareholders," said Weinberg.
Barry Rosenstein, the founder of activist hedge fund Jana Partners, told the audience that CEOs often clear their calendars immediately and fly to New York to meet with him when they learn he has a stake. Rosenstein successfully pushed for a breakup of McGraw-Hill (MHP).
Not everyone will stay private though. Andreessen thinks at least one of the companies in which he holds a stake will be ready to go public in the next year or two: Twitter.
If that happens, it would likely be the biggest IPO since Facebook.
