IPOs: A Modest Turn Around the Corner

Sam Colella remembers the exact day the initial public offering market fell apart. The venture capitalist and chairman of the biotech company Fluidigm was in Switzerland in September 2008 when the company's investment banker called to say Lehman Brothers had failed. So unnerved was the banker, who worked for Morgan Stanley, that he stuttered out the news. Days later, Fluidigm canceled its offering, setting off the longest IPO drought for startups in 40 years.

That drought is ending. The number of startup companies going public in the upcoming year is expected to increase substantially from the 13 offerings in 2009, although the precise number is a matter of much debate. Venture capitalists predict offerings will double, to 26, according to a survey by the National Venture Capital Assn. of 325 members. Other experts believe the number may go beyond 50. "You could see 80 to 90 [companies] spend the million dollars to file, and north of 50 go public," says Tony Perkins, founder of tech conference promoter AlwaysOn Network. Fluidigm plans to be one of them, since Colella thinks investors are ready to take risks again.