Morgan Stanley predicts another 10 to 15 tech IPOs in 2024, better in 2025.

After a long waiting period, “the IPO market is back.”

This is according to Colin Stewart, Morgan Stanley global head of technology capital markets. In an interview with CNBC’s “TechCheck” on Monday, Stewart said another 10 to 15 tech companies could go public before the end of 2024, with 2025 expected to be an even “better year.”

“It was a long two and a half years where we didn’t really have anything,” Stewart said. Recent initial public offerings have been highly priced and traded well, which “bodes well for the future,” he added.

The lull began in 2022, when rising inflation and rising interest rates pushed investors away from risk, drove down tech valuations and caused many tech companies to delay plans to go public. This was a stark contrast to the previous two years, which saw a record number of deals, including some at astronomical multiples.

The IPO market opened in September with the debut of Instacart and Clavio. But the first real signs of momentum appeared last month, as Reddit became the first IPO for a major social media company since then Pinterest in 2019 and a data center connectivity chip company Astera Laboratories jumped on its first day of trading.

Both stocks remain well above their IPO price, with Astera up about 145% as investors pour money into all things artificial intelligence.

Morgan Stanley was the lead banker on the Reddit and Astera IPOs, positioning itself to raise approximately $37 million in total fees.

Wall Street Rival Goldman Sachs led the latest venture-backed tech IPO last week. rubricwhich develops data management software, jumped 16% in its debut on the New York Stock Exchange.

Stewart, who has had a hand in some of the biggest offerings of the past few decades, said it typically takes six months to get to the IPO finish line. That means companies currently considering IPOs will likely hold off until 2025 to avoid a conflict with the U.S. presidential election in November, he said.

As for valuations, Stewart said the market has retreated from the peak days of 2021 and ratios in software and other parts of technology are now returning to levels seen in 2018 and 2019. Stewart described 2021. as an “amazing year” but also “exhausting”. .”

“What’s happened in the last six to 12 months is that the market has become more comfortable paying for growth again,” Stewart said. “We’re not back to 2021 levels, but we’re getting a fair price for growth. And I think at these prices you start to see companies say, ‘You know, it’s actually not a bad thing to be a public company.'”

Still, the most valuable late-stage companies haven’t exited yet. This list includes Elon Musk’s SpaceX along with Stripe and Databricks.

Although Stewart said he “would like to take them public”, he acknowledged that the challenge for the bigger names is “they have scale, they have growth, investors are giving them a lot of capital” and they are investing towards the future.

“Right now, an IPO is not on their near-term horizon, unfortunately,” he said. “But when it comes, they’re going to be a blockbuster.”