Rob Arnott has a message for anyone who thinks the coming wave of tech mega-IPOs is unambiguously great news for markets: think again.
The founder and chairman of Research Affiliates warned on June 5 that forthcoming listings from SpaceX, Anthropic, and OpenAI could create a prolonged drag on the broader equity market, diverting tens of billions of dollars away from existing stocks over multiple years.
The capital vacuum problem
SpaceX’s IPO is expected to raise approximately $75 billion, which would make it the largest public listing in history. To put that in perspective, Saudi Aramco’s 2019 IPO raised about $25.6 billion. Anthropic has filed confidential IPO paperwork following a funding round that valued the AI company at nearly $1 trillion. OpenAI is also expected to pursue a public listing.
Arnott’s concern isn’t about any single IPO in isolation. It’s the cumulative effect. When this much new equity hits the market in a compressed timeframe, existing shareholders in legacy companies get crowded out. Arnott described the dynamic as “drip, drip pressure,” referring to the ongoing impact of repeated share floats and the mechanical index rebalancing that follows each major listing.
