Startup IPOs Face Sharper Public-Market Profitability Test

A company’s IPO is when it sells shares to the public for the first time.

AceVector’s shares began trading below the price offered to IPO buyers, even though many people had applied.

This is one sign that public investors are looking more carefully at what startups are worth.

Many startups hoping to go public are still losing money.

Some have lowered their expected values or postponed their IPOs.

Companies that are making profits or improving their losses may have an easier time asking for higher values.

But even profitable companies may be worth less than they were during the investment boom of 2021.

Investors are judging each company more closely on its results.