Welcome to the 105th edition of Deep Tech Catalyst, the educational channel from The Scenarionist where science meets venture!
When does it actually make sense for a Deep Tech company to go public, and what does it take to step into the markets without being crushed by public expectations?
The answers to those two simple questions are anything but obvious. They sit at the intersection of strategy, preparation, and relentless execution.
So, I sat down with Adam Bergman, Managing Director at EcoTech Capital, and explored what IPO-readiness really means for Deep Tech companies.
Key takeaways from the episode:
🛎️ IPOs Are About Deep Capital and Signaling, Not Just Liquidity
Going public is less about giving early employees a way out and more about accessing the deepest pools of institutional capital and the credibility that comes with being a listed company.
📏 There’s a Real Threshold for Scale, Profitability, and Market Relevance
Deep tech companies that can’t clear basic bars on size, margins, and long-term growth potential risk sliding into micro-cap territory, where many institutional investors simply can’t or won’t participate.
🗺️ You Need a 24-Month Plan to Educate the Street
Successful IPOs are built on years of relationship-building with investors and analysts, a clear milestone roadmap, and visible progress toward EBITDA or cash-flow positivity before listing.
🎯 First Movers Get to Define the KPIs for the Whole Category
Early public companies in a space effectively teach the market which metrics matter, turning their own operational strengths into the scorecard that later competitors will be judged against.
📈 The Roadshow Is Short, but Early Misses Have Long-Term Consequences
Those final weeks of meetings are about converting trust into commitments—and if a newly public company then misses its first or second quarter guidance, the credibility damage can shape its stock and financing options for years.
BEYOND THE CONVERSATION — STRATEGIC INSIGHTS FROM THE EPISODE
Why Companies Decide to Go Public Today
For any founder building a capital-intensive company, the question of how the journey ends is not theoretical. At some point, there is an exit.
Sometimes that means a sale to a strategic buyer.
Sometimes it means ringing the bell and stepping into the public markets.
Both paths matter. Profitability is a powerful advantage whichever route a company ultimately takes. But the specific role of an IPO, and the logic for choosing that option over an acquisition, has shifted meaningfully over the last twenty-plus years.
From Internet Mania to Today’s IPO Market
The frame most people still carry around for IPOs was forged in the late 1990s and early 2000s.
That period, defined by healthcare internet stories and general internet excitement, was a time when simply being associated with the web was enough to generate extraordinary investor enthusiasm.
Many of the companies going public then were not especially capital intensive. They were software and internet businesses where the primary assets were people and code, not factories and hardware.
Yet the public markets were hungry for anything with a dot-com label.
Institutional investors wanted to show exposure to the internet in their portfolios, and being public was almost synonymous with being part of that moment.
In that environment, the logic of going public was straightforward. The markets were open. Investors were eager.
Fast forward to today, and the landscape looks very different.
The number of IPOs has fallen sharply. Fewer companies are choosing to go public, and fewer remain public overall. That is not a small change at the margins; it signals a deeper shift in how both founders and investors think about the public markets as a destination.
Access to Deep Capital Pools and Credibility
With that backdrop, it is natural to ask: why pursue an IPO at all? In practice, two reasons still stand out.
The first is access to capital. For all the growth in private funding, the public markets remain the deepest pools of capital available. Institutional investors operating in those markets control enormous resources. For businesses that are large, capital intensive, and still in growth mode, the ability to tap those pools can be decisive.
The second is a form of validation that doesn’t show up on the balance sheet, but it does influence how a company is perceived. That signal matters in concrete ways. Some customers—particularly large corporations and government entities—feel more comfortable awarding business to a company with a ticker next to its name on an exchange like NASDAQ.
Founders working in sectors tied to energy, transportation, grid infrastructure, storage, or agri-food technologies often face established incumbents with long histories and trusted brands.
In that context, being able to stand in front of a customer and say, “We are a public company,” is not a vanity point. It can be part of how a younger business shows it belongs in the same consideration set as much older competitors.
What “IPO-Ready” Really Means: Scale, Profitability, and Investor Relevance
Public markets operate with their own thresholds, constraints, and expectations. To be a real candidate for listing, a company has to clear some basic hurdles of size and financial performance, and it has to matter enough to institutional investors and research analysts that they are willing to spend time and capital on it.
In practice, “IPO-ready” is a mix of scale, profitability, and relevance. Missing any one of these makes life as a public company significantly harder than it needs to be.
Valuation, Size, and the Micro-Cap Trap
One of the first issues is scale. A company that is too small may not fit well into the way many institutional investors are mandated to operate. There is a very practical lower bound on valuation.
As a rule of thumb, a company will often need to be expected to be worth at least 500 million dollars at the time of listing, and in reality, a billion-dollar valuation is a much more comfortable line.
The reason is not ego; it is the mechanics of how funds build portfolios.
If a company’s valuation falls to 3 or 4 hundred million dollars and stays there, it begins to drift into micro-cap territory. That is a category many large investors are either formally restricted from owning or simply choose to ignore.
For a newly public company, that is dangerous ground.
So the minimum scale question is about avoiding a structural classification that shuts the door on exactly the kind of investors a capital-intensive business will depend on over time.
Share Price Dynamics and Structural Constraints on Ownership
Alongside overall valuation, there is another technical constraint that can materially shape a company’s life in the public markets: the share price itself.
In many cases, a meaningful portion of institutional investors tend not to buy stocks that trade below certain levels, and $5 per share is often treated as a practical threshold.
Below that level, institutional participation can narrow quickly.
It is not unusual to see companies go public at $8, $9, or $10 per share, especially when they are pricing toward the low end of their IPO range.
If something goes wrong and the stock drops below $5, similar constraints can reappear: many institutional investors simply won’t own shares trading under that price.
In those situations, some companies attempt a reverse stock split to lift the nominal share price back above the threshold. Typically, this does not resolve the issue for long, and the stock price often drifts back down again.
Revenue, EBITDA, and Financing the Full Business Plan
Beyond scale, public investors want to see a business that is already meaningful in absolute terms.
The numbers will vary by sector, but a useful benchmark is at least 100 million dollars of annual revenue and, ideally, 10 to 20 million dollars of EBITDA.
If a company raises capital in an IPO but still doesn’t have enough funding to execute its business plan, investors assume it will need to return to the market for substantial additional capital before reaching profitability—and they price in that future dilution and uncertainty.
In recent years, those situations have often been hit hard by investors.
There is a persistent concern about whether non-profitable companies will continue to find financing in an environment where not every follow-on deal gets done.
That concern shows up as a valuation discount, or as outright reluctance to participate in the IPO at all.
From the company’s perspective, this means that preparing for an IPO is not just about hitting a certain revenue threshold. It is also about being able to show a credible path to EBITDA positivity or cash flow breakeven, and ideally about not needing constant returns to the equity markets just to keep the plan alive.
The more self-sustaining the business can become by the time it lists, the more comfortable public investors will be in backing it.
The Lens of Public Investors
Even with the right scale and improving profitability, there is another dimension that matters: relevance. Public investors have no obligation to own any particular stock. They can choose from thousands of listed names across every sector.
A company seeking their attention has to answer two basic questions: why this business, and why now?
In public markets, attention doesn’t spread evenly. Some sectors simply feel more “exciting” or easier to underwrite—because the growth drivers are (or seem) more familiar than others.
For Deep Tech companies building industrial hardware, complex infrastructure, or highly technical systems, that dynamic matters.
The challenge is not just proving the technology works; it’s making the business legible to investors—connecting a credible present to a clear path toward scale and profitability, in language the market can benchmark and follow quarter after quarter.
At the same time, public investors think differently from venture funds.
Their risk tolerance is lower. They benefit from liquidity and can move in and out of positions quickly. They are not committing to holding through a decade of volatility. For them, owning a newly public company is a trade-off between near-term execution risk and long-term upside.
That is why it is not enough to talk exclusively about a distant future.
A pitch built around “in twenty years we will be enormous and profitable” with little evidence of traction today will struggle. The story has to connect a credible present—a functioning business with real revenue and improving margins—to a believable future of expansion.
Planning on a Two-Year Horizon
Deciding to go public is not the moment to start thinking about the public markets.
By the time a company files, the institutional investors who matter most should already know the story, understand the business model, and have seen concrete evidence that management does what it says it will do.
That kind of trust cannot be built in a few weeks. A realistic horizon for serious preparation is about two years.
That may feel long from a founder’s point of view, especially in fast-moving markets, but it reflects how institutional investors actually work when they are considering backing a new, capital-intensive business they have never seen trade before.
Why the Pre-IPO Journey Starts 24 Months Out
The starting point is accepting that most institutional investors will not write a check for an IPO the first time they meet a company.
Particularly in newer or less familiar sectors, they need time to study the market, understand the drivers of the business, and get comfortable with the management team.
If the first encounter happens during the compressed two-week equity roadshow that immediately precedes an IPO, the odds of attracting those investors are low. At that stage, they are being asked to make a decision quickly, under time pressure, on a company with no trading history and limited public information.
For many, that is simply too much risk.
Beginning the process roughly 24 months before a planned listing gives room to do something very different. It allows management to meet investors in a low-pressure setting where the goal is education rather than allocation.
It creates space for a conversation to unfold over time instead of forcing a snap judgment.
The company can introduce itself, explain what it does, and outline where it aims to be by the time it is ready for the public markets. Investors, in turn, can ask questions, follow the company’s progress, and decide whether the way management thinks and executes matches the promises being made.
Operating in Sectors with Few Public Comparables
The standard way public investors evaluate a potential IPO is by looking at existing listed companies and examining how they trade: revenue multiples, EBITDA multiples, or net income multiples, depending on the maturity and profitability of the peer set.
In many of the markets where capital-intensive innovation is happening now, that peer set can be either small or misleading.
On one side of the spectrum sit large, legacy incumbents—big, established businesses that may be profitable but are not growing quickly.
On the other side are small, underfollowed public companies whose stocks trade for a few dollars a share, with market capitalizations in the low hundreds of millions and little or no research coverage.
Neither group is truly comparable to a young but rapidly growing company with significant expansion ahead of it. If investors default to those benchmarks, they may end up applying valuation frameworks that do not reflect the real potential of the business.
That is why the education process has to include a thoughtful conversation about comparables.
Management needs to be ready to explain which public companies are the closest reference points and why, even if they sit in adjacent segments rather than in the exact same niche. Investors need time to absorb that framework, test it against their own analysis, and decide whether it makes sense.
Owning the Narrative: Designing KPIs That Play to Your Strengths
When a company approaches the public markets, it is not only its revenue, margins, or cash flow that gets judged. It is also the lens through which those numbers are interpreted.
That lens is built from key performance indicators, and in many emerging industries, those indicators are not handed down from above. They are defined, often implicitly, by the first credible companies that come to market.
That creates a real opportunity.
Instead of being forced to compete under someone else’s rules, a company can shape the conversation around the dimensions where it is genuinely strongest.
The way it chooses and explains its KPIs will influence how investors think about the entire category, and how later entrants are compared.
Every Industry Has Its Own Metrics—and Its Own Room to Define Them
At a basic level, every public company is evaluated on a common set of financial metrics. Revenue growth, absolute revenue, gross margin, EBITDA margin, cash flow, and net income are always in the frame.
Those numbers are the language of the markets, and no business can ignore them.
But beyond that shared core, each industry develops its own set of operational and strategic indicators. These are the metrics that translate the specific physics or economics of a business into something investors can follow and compare.
In biologics, for example, it might be the percentage efficacy with which a treatment targets weeds or protects a crop.
In robotic systems working in the field, it could be the speed at which a machine can move down a row to harvest, cultivate, or weed without compromising quality.
In solar, it is the percentage of sunlight a panel can convert into usable energy.
These sector-specific KPIs are not preordained. That is why it is so important for management to step back and ask some fundamental questions: where is the company’s true competitive advantage, how can that advantage be expressed in quantifiable terms, and which metrics, if adopted by the market, would highlight that edge most clearly?
Learning from Early Solar IPOs: How First Movers Set the Rules
The dynamic is easy to see in the early days of solar IPOs. Back then, most institutional investors and research analysts knew very little about the sector, so the first credible public stories helped teach the market what questions to ask.
In our conversation, three case studies captured that dynamic in practice.
One early deal was built around flexible solar panels. With little else to anchor on, flexibility became the reference point investors kept coming back to—because it was the first concrete comparison they had.
A subsequent company came to market with a different angle: high efficiency, centered on how much power you could get out of a panel. In that framing, flexibility wasn’t the point; efficiency was.
Then another company arrived, positioning itself around low cost—arguing, in effect, that cost was the metric that mattered most.
What emerged from that sequence was not a single definitive KPI, but a vivid illustration of how early public companies in a new field teach investors what to care about.
Each one defines success in its own terms, and those definitions shape the questions investors ask of everyone who follows.
For a founder contemplating an IPO in an emerging or technical industry, that history carries a clear lesson. Coming to market early is not just about capturing capital. It is about defining the scorecard by which you and your competitors will be judged.
Keeping Public Investors Engaged
Finally, KPIs have a role to play not just in getting a company public, but in keeping its investor base engaged afterwards.
Again, public investors do not behave like early-stage venture funds. They are not necessarily locked in for a decade. They can exit after the first day of trading if they choose, especially if the stock trades up sharply.
One way to counterbalance that pattern is to give investors a clear, long-term framework for why they should stay.
Well-chosen KPIs help make that case.
They give investors a way to see how the story unfolds quarter after quarter, beyond the initial excitement of the listing. If the metrics that matter most are improving steadily, if milestones are being hit, and if those trends are visibly tied to future growth and profitability, it becomes easier for investors to justify holding the stock rather than treating it as a short-term trade.
From Preparation to Roadshow: Turning Long-Term Work into a Successful Listing
All of the preparation that goes into an IPO—the years of educating investors, refining KPIs, hitting milestones, and moving toward profitability—ultimately converges on a short, intense moment: the roadshow.
For management, those final weeks are when the story has to land.
The company moves from talking about a possible future listing to asking investors, very directly, to commit capital at a specific price and on a specific timeline.
The roadshow is not the beginning of the relationship with institutional investors. It is the culmination of everything that has gone before.
When it works, it is because the groundwork has been laid carefully, and the story being told in those meetings aligns with what investors have already seen over the preceding months and years.
What Actually Happens on the Roadshow
In practical terms, a traditional roadshow is a concentrated sequence of meetings, presentations, and conversations with institutional investors across major financial centers.
It typically runs for 2 or 3 weeks, depending on the size of the deal and the geographic reach of the investor base.
In other words, the roadshow is the period when the company has the full attention of the market and must use that time to make its case as clearly and convincingly as possible.
Moving from “We Plan to Go Public” to “We Are Going Public Now”
One of the biggest shifts between the long preparation period and the roadshow is the tone of the conversation.
When management is still 18 or 24 months away from an IPO, meetings with investors are largely about education. The message is: here is what we do, here is how we are growing, and at some point in the future, we expect to be in the public markets.
During the roadshow, that changes.
The language becomes immediate. The company is no longer talking about a hypothetical listing; it is saying, “We are going public in the next two weeks. We would like you to participate.”
That shift in tone is only credible if the intervening period has been used well.
If investors feel as though they are meeting the company for the first time, the request for capital will feel abrupt and risky. If they have been following the story for years, seeing milestones achieved and plans executed, the roadshow becomes a natural next step in a relationship that already exists.
In that sense, the roadshow does not replace the long-term work; it compresses it. It is a focused, time-bound attempt to turn familiarity and trust into investor buy-in.
Articulating the Story Clearly to an Investor Base That Knows Your History
Because of this, one of the main points of friction in a roadshow is often not about the underlying business but about how effectively management can articulate the story under pressure.
Institutional investors are being asked to take a risk on a company that has no trading history. They cannot look back at a decade of stock price behavior, prior management changes, or market reactions to past earnings reports.
With an already public company, an investor can study the record and decide how management has handled good news, bad news, and changing conditions.
With an IPO candidate, that record does not exist in the public domain.
The only evidence available is what investors have observed privately and what is presented during the roadshow itself.
That is why the quality of communication in those meetings is so critical.
The Non-Negotiable: Hitting Guidance in the First Quarters After Listing
All of this effort around storytelling and relationship-building ultimately converges on one unforgiving reality: after the IPO, the company has to hit its numbers.
The projections it gives the market for its first quarter as a public company, its second quarter, and ideally its third and fourth, are not just targets. They are tests of whether management understands its own business.
From the perspective of institutional investors, missing those early projections is a serious red flag.
The logic is straightforward.
A company that has been preparing for an IPO for years should have as clear a view as possible of its near-term performance. If, despite that preparation, it misses its guidance almost immediately, investors are left asking how well the team really knows its own operations and how reliable any future projections will be.
That is why the discipline of setting realistic milestones during the private phase is so important.
How Missing Early Numbers Becomes a Structural Problem, Not Just a Bad Quarter
When a newly listed company misses its numbers in the first or second quarter after an IPO, the impact goes far beyond a single earnings print.
Investors do not treat it as an isolated misstep.
They interpret it as evidence that management may not have a firm grip on the business, and that any projections further out are less trustworthy than they appeared in the prospectus.
The immediate reaction is often a sharp drop in the share price.
This is why thinking about the IPO as a long, deliberate process matters so much. The roadshow is not just about filling an order book. It is about stepping into a new environment with the highest possible chance of meeting or exceeding the expectations that have been set.
