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Public Opinion

Becoming synonymous with inflated valuations and dotcom disasters hasn't done much for IPOs' reputation. How long before we can start to talk about going public again without snickering?

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This story appears in the October 2002 issue of Entrepreneur. Subscribe »

When San Diego-based biotechnology firm MitoKor filed for an IPO in March 2002, the market for new issues was looking downright abysmal. Gone were the heady days when "concept companies" with no revenue to speak of--let alone profits--debuted to great fanfare and triple-digit first-day returns. Instead, "newcos," or prospective new issuers like MitoKor faced a marketplace still reeling from the demise of the dotcom frenzy, the trauma of terrorism and investors disillusioned by the Enron debacle--all of which upped the ante for IPO--bound firms.

"To go public today, you will have to show eight quarters of solid revenue growth, an organization where costs are controlled and probably at least four quarters of profitability," asserts Mark Jensen, partner and national director of venture services at Deloitte & Touche.

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