Key Takeaways

  • ClickHouse generated over $350 million in annual recurring revenue (ARR), yet Co-Founder and CEO Aaron Katz sees no immediate reason to go public next year.
  • Structured secondary tender offers have eliminated the historical pressure to list early, letting private companies give employees liquidity without facing public short sellers.
  • Public tech stocks face severe swings, trading down 40% to 50% on a minor quarterly miss, which damages team morale and distracts leadership.
  • Mega-scale private deals, like Stripe pursuing acquisitions between $8 billion and $60 billion, prove that staying private no longer caps strategic scale or buying power.

The Zero-Upside Public Market Trap

When enterprise software companies crossed $100 million in ARR a decade ago, the path was clear: hire bankers, file an S-1, and ring the bell. Today, ClickHouse sits past $350 million in ARR, and Aaron Katz is in zero rush to ring any bells.

“We could take the company public next year if we wanted to,” Katz told Harry Stebbings on 20VC. "There's no rush."

The math behind going public has flipped. In previous cycles, listing was the only way to establish credibility, raise cheap capital, and reward early staff. Today, public listings create real risk for late-stage software companies.

“The markets are more irrational now I think than they've been in a long time,” Katz said. “It's pretty rough being a public company, and your stock can trade down 40, 50% on a slight miss in a quarter. We know that impact on employee morale, and you don't have that in the private markets.”

When a stock drops by half after a tiny guidance adjustment, hiring stalls. Engineers watch their net worth evaporate on a Tuesday morning. Executive teams spend half their calendar managing sell-side analysts rather than building infrastructure. For a company growing real-time data engines, quarterly volatility is pure tax.

Private Scale Without Public Short Sellers

Two historical moats once forced companies onto the public exchanges: liquidity for employees and balance sheet power for massive acquisitions. Both moats have evaporated.

Private liquidity used to be binary: you either had an IPO, got bought, or held illiquid stock options for a decade. Now, late-stage startups run recurring secondary sales.

“The employee liquidity has more or less gone away because you can do structured tenders and you can give your employees liquidity over time,” Katz noted. “The bear thesis hasn't gone away. You don't have people shorting your company when you're a private company.”

At the same time, private market scale now equals public market scale. Companies no longer need public equity as currency to buy competitors.

Katz pointed to recent private mega-transactions as proof: “Stripe is buying PayPal for 50 to 60 billion as a private company and OpenRder as well at 8 billion. These are two pretty sizable acquisitions that traditionally would be unthinkable for a private company.”

That does not mean public markets are obsolete. Katz noted that public investors ultimately reward actual execution over speculation: “Public markets are generally better than private markets in the long term. They behave more rationally than private investors who are willing to pay a premium to get into a company betting on the come. In the public markets, you're really getting credit for where you are at that point in time.”

The difference is timing. Going public when your business is still expanding its core product exposes your team to irrational swings. Staying private lets you compound value in peace.

What to Do With This

Audit your company equity and liquidity timeline this week. If you have employees past their four-year vesting cliff, do not use an IPO as your default answer for their wealth realization. Talk to your lead investors about setting up an annual structured secondary tender offer with clear participation caps (such as 10% to 15% of vested equity), so you keep your best talent focused on shipping rather than watching public tickers.