No Venture-Backed IPOs In Over Two Months

Venture capitalists continue to roll out filings of public offerings with hopes the market will give in, but public investors haven’t budged in more than two months, acccording to Dow Jones VentureWire reports (subscription required).

May was the second consecutive month that no venture-backed companies have reached the public markets. In fact, heart-rhythm monitor specialist CardioNet was the last such company to stage an IPO, on March 19.

There hasn’t been an IPO drought like this since early 2003, when there was a nearly five-month lull between public offerings of venture capital-backed companies from Dec. 18, 2002 to May 12, 2003, according to data from VentureSource, a research unit of Dow Jones & Co., publisher of VentureWire.

Already, 12 venture-backed companies have withdrawn their IPO filings due to market conditions, double the amount of companies that have held IPOs this year.

Of the six IPOs this year, four companies are in the health-care sector and two are in information technology. The last technology IPO was software maker ArcSight on Valentine’s Day — its investors haven’t shown it much love, as ArcSight’s shares have fallen more than 2% since they were priced at $9, the low end of an expected price range.

By this time last year, there had already been 32 VC-backed companies that hit the public markets. In 2007, 73 such companies went public, the most since 2000.

However, most of the companies that went out last year haven’t exactly fared well since their IPOs. Out of this group, 52 companies, or 71%, have seen their shares fall since they went public, while 29, or 40%, have lost more than one-third of their market share. Collectively, the 73 companies have seen their shares fall more than 10%. This is partly attributable to the turmoil in the stock markets: The Nasdaq Composite Index is down about 8% since the start of the year, though it is up about 1.2% since the start of last year.

Despite the current situation, 12 venture-backed companies have filed for IPOs since CardioNet went public. Five are in the health-care sector, while the other seven — five of which are profitable - are in the technology, materials or services sectors.