Five years ago, the path for a successful Australian tech company was reasonably predictable. Found a company, raise a seed round, progress through Series A and Series B, aim for profitability or at least strong revenue growth, and then list on the ASX. The public markets were the destination. Everything before that was the journey.

That sequence is breaking down. An increasing number of Australian tech companies with the revenue and maturity to pursue an IPO are choosing not to. They’re raising large private rounds instead, staying off public markets, and in some cases rejecting the idea of listing entirely.

The trend is global, but the local dynamics are worth examining. They reveal something about Australia’s capital markets, founder preferences, and the changing economics of venture capital.

The Numbers

The ASX saw just four technology IPOs in 2025, raising a combined $340 million. In 2021, there were 19, raising over $2.4 billion. Adjusted for market conditions—2021 was unusually frothy—the decline is still striking. The pipeline for 2026 isn’t much stronger. Based on publicly known preparations and market intelligence, fewer than six tech companies are expected to list in Australia this year.

Meanwhile, late-stage private funding is growing. Australian tech companies raised approximately $1.9 billion in Series C and later rounds in 2025, according to data from Cut Through Venture. That’s a 35 percent increase from 2024 and a record for the Australian market. Several of those rounds were in the $100 million to $300 million range—sizes that would historically have been replaced by an IPO.

Companies like SafetyCulture (last valued at $2.6 billion), Employment Hero ($1.5 billion), and Rokt ($2.8 billion) have all raised substantial private rounds in the past 18 months without any indication of imminent public listing. Canva, Australia’s most valuable private company at roughly $26 billion, has been “pre-IPO” for so long that the designation has lost meaning.

The Pull of Private Capital

The simplest explanation is that private money is available. The global pool of late-stage venture capital and growth equity has expanded enormously. Firms like Tiger Global, Insight Partners, and General Atlantic routinely write cheques exceeding $100 million. Australian-focused funds including AirTree Ventures, Blackbird, and Square Peg Capital have raised larger vehicles to support companies through later stages.

For a company that can raise $200 million from a handful of sophisticated investors, the IPO proposition—roadshow obligations, underwriting fees, quarterly reporting—looks less attractive. Private rounds also let companies control their investor base, selecting backers who bring strategic value rather than opening the register to short sellers and day traders.

The Push Away from Public Markets

The pull of private capital is only part of the story. There’s also a set of factors pushing Australian tech companies away from the ASX specifically.

Analyst coverage is thin. Most ASX-listed tech companies are covered by three to five analysts. A comparable US mid-cap might have 15 to 20. Limited coverage means less liquidity, wider spreads, and valuations that don’t always reflect trajectory. Several founders have described feeling “orphaned” on the ASX.

The investor base is conservative. Australian institutional investors lean heavily toward mining, banking, real estate, and dividends. Growth-stage tech companies often find the local market doesn’t value their business model, resulting in lower multiples than they’d receive on US exchanges.

Compliance costs add up. Continuous disclosure, half-yearly reporting, and governance requirements consume management attention that a fast-growing company would rather spend on product and market expansion.

The Nasdaq is the real alternative. For companies that do want public markets eventually, the Nasdaq offers higher valuations, deeper liquidity, and a more tech-literate investor base. Atlassian set the template in 2015, and others have followed.

The Consequences for the Ecosystem

The trend toward staying private has real consequences for Australia’s tech ecosystem.

Retail investors miss out. When companies stay private, ordinary Australians—including through their super—can’t participate in the value created by the country’s most successful tech firms. The wealth from Canva, SafetyCulture, and peers accrues to institutional venture capital investors.

Employee liquidity is constrained. Early employees hold equity they can’t easily sell. Secondary markets are thin in Australia, leaving people with significant paper wealth they can’t access for years.

Price discovery is limited. Public markets provide transparent pricing that signals the broader economy. Private valuations are limited to what gets disclosed in funding announcements—often selective or optimistic.

The ASX tech sector stays underdeveloped. Technology accounts for roughly eight percent of ASX market capitalisation versus over 30 percent for the S&P 500. Every company that stays private or lists overseas widens the gap, making the ASX less attractive for the next generation. It’s self-reinforcing.

Is This a Problem to Solve?

There’s an argument that this is simply rational behaviour—founders making the best decisions for their businesses. Trying to force companies onto the ASX through incentives would be artificial.

But the consequences—reduced retail access, constrained liquidity, an underdeveloped public tech market—are worth taking seriously. The ASX has tried streamlined listing requirements and a tech index, but neither has changed the calculus for most founders.

The more productive focus might be on broadening access to private tech investment. If super funds and retail investors could participate through fund-of-funds structures, secondary market platforms, or patient growth vehicles, the economic benefits of Australia’s tech ecosystem could be distributed more broadly, regardless of whether companies ever list.

That’s harder than tweaking listing rules. But it’s probably the right problem to solve.