Stock Market or Private Capital? How Public and Private Markets Are Shifting, and What It Means for Your Next Deal

13 May 2026

Many entrepreneurs, board members, and CFOs today face a decision that often didn’t even arise ten or twenty years ago: Should our next major step involve going public, or should we deliberately remain private? A stock market listing is the most visible difference between public and private markets. In practice, however, there is much more at stake: trust and visibility, ongoing obligations and costs, speed and confidentiality, and the question of how feasible a future sale, an investor entry, or even an IPO actually is. Those who address these questions in a timely and thorough manner create room for maneuver. Those who tackle them too late often pay the price in lost time, higher transaction risks, or a blocked exit.

From the stock market standard to the private standard: what has changed?

Looking at developments over the past two decades, a clear trend emerges: in many countries, there are fewer publicly listed companies today than in the past, while private capital markets have gained significant ground. For Switzerland, internationally comparable data shows that the number of listed companies stood at 206 in 2024, while the peak in 2003 was 289[1] . For the U.S., the shift is even more pronounced: 4,010 listed companies were reported in 2024; the peak was 8,090 in 1996[2] . At the European level as well, it is evident that while stock exchanges continue to exhibit large trading volumes and market capitalization, the number of listed companies is not increasing to the same extent; FESE reports approximately 7,718 listed companies on its member exchanges as of the end of 2023[3] .

At the same time, a second reality has emerged: “Staying private” is no longer merely a transitional phase for many companies today, but a genuine alternative, even for very large enterprises. One indicator of this is the volume of assets managed in private markets: McKinsey estimates private markets assets under management (AUM) as of June 30, 2023, at $13.1 trillion[4] . In simple terms: In the past, going public was the obvious next step for many growing companies. Today many companies can scale up privately for a long time. Going public is increasingly becoming a late, very deliberate step rather than a standard path.

Why is this happening?

Three main reasons explain this trend particularly well. First, being “publicly listed” comes with ongoing obligations that cost time, money, and organizational resources. Publicly traded companies must disclose more information more quickly, comply with stricter rules, and be highly disciplined in their communication with the market. The fact that this issue is recognized at the political and regulatory levels is demonstrated, for example, by the so-called EU Listing Act[5] : It aims to facilitate access to public capital markets and simplify listing rules so that stock market listings become more attractive again.

Second, there have been many takeovers in Europe where publicly listed companies were subsequently delisted. This “take-private” trend reduces the number of publicly traded companies without necessarily saying anything about the quality of the companies. A report by New Financial shows that over the past decade, more than 1,000 listed companies in Europe with a total value of over USD 1 trillion were delisted following takeovers by private buyers or private equity firms[6] .

Third, private capital is so readily available today that an IPO is often no longer “essential” as a source of financing. When large volumes of capital are available in private equity, growth financing, and private credit, even large companies can finance growth, acquisitions, or restructurings privately—often more quickly and confidentially. The scale of private markets AUM, in turn, demonstrates that this capital base is structural.

It is important to clarify one point: The decline of the traditional public company cannot be explained primarily by the fact that publicly listed companies are “less well-regulated.” Often, the opposite is true. The core issue lies rather in the fact that the cost-benefit ratio of listing has changed, and private alternatives have become more realistic.

Public vs. Private: What are the key advantages and disadvantages, explained in simple terms?

In practice, public and private are not opposites, but two different sets of rules. A publicly traded company primarily offers visibility and liquidity. The company’s value is continuously visible through trading on the stock exchange, investors can generally enter and exit more easily, and this can facilitate capital raising or build trust. For certain companies, the ability to use shares as “currency” for acquisitions is also important. On the other hand, a stock exchange listing requires ongoing disclosure and formal processes, thereby creating a permanent burden; the fact that the EU Listing Act aims to simplify these requirements shows how significant these hurdles are from the perspective of policymakers and the market.

Private companies, by contrast, offer greater flexibility and more room for maneuver. Owners, investors, and management can tailor rights and obligations contractually, such as information rights, approval requirements, and rules for reaching a solution even in the event of disagreement. This is often more discreet and can be more long-term because not every development needs to be publicly accounted for. At the same time, “private” does not mean “simple.” Private investors typically secure their position through detailed contractual rights, and the sale of shares is less automatic because it requires a buyer and a well-structured process. Those who remain private therefore need particularly clear rules regarding how liquidity and exit strategies will function later on.

What does this mean for you in concrete terms? Where do the greatest legal risks arise in M&A transactions?

In reality, transactions rarely fail due to the fundamental question of “public or private,” but rather because of details that are clarified too late. For many companies today, the most important strategic goal is optionality: they don’t just want a Plan A, but want to be able to choose between several paths at the right moment—such as a sale to a strategic buyer, an investment by private equity, a secondary solution, or even a later IPO. The fact that take-private transactions and delistings have occurred on a significant scale in Europe underscores how quickly paths can shift.

This is precisely where in-depth transaction experience creates added value. In public transactions, timing, disclosure, confidentiality, governance, and market rules are often decisive in determining whether a process proceeds in a controlled manner or whether unnecessary risks arise. In private transactions, the typical stumbling blocks lie in the contractual architecture: Which decisions require approval, what information rights apply, how are conflicts of interest resolved, how are management equity stakes structured, and how does one prevent an exit from later failing due to a deadlock? These points are not merely “legal niceties,” but are economically central because they directly determine whether a transaction can be closed quickly and smoothly and whether the parties remain truly capable of acting after closing.

To make this tangible, consider three typical situations we regularly encounter in practice. A family business seeking a succession solution often needs a process that ensures discretion while still allowing for competitive bidding and addressing the right guarantees, risks, and transition arrangements. A high-growth company bringing in investors usually wants capital and expertise, but at the same time wants to retain operational autonomy and establish clear rules for future financing rounds and an exit. And a publicly traded company planning a strategic move must navigate the issues of communication, governance, and transaction security with particular care so that the process isn’t complicated by avoidable risks. In all three cases, what ultimately matters is not the buzzword, but the legal and strategic implementation.

What does the future of public markets look like compared to private markets?

From today’s perspective, the future is not an either-or world. Private markets will remain large and are likely to continue gaining importance because ample capital is available, allowing companies to scale up privately for longer; the magnitude of assets under management in private markets is a strong indicator of this. At the same time, public markets will not disappear but will become more selective: fewer listings, but often larger and more mature ones, accompanied by reforms designed to make a public listing more attractive again, as the EU Listing Act demonstrates.

In practical terms, this means that for companies and investors, success goes to those who understand both worlds and structure their operations in a way that allows them to act quickly when favorable market opportunities arise. This is precisely what determines whether a deal looks good “on paper” or actually works in practice.

Conclusion

Today, public or private is not an ideology, but a decision regarding rules of the game, obligations, speed, and exit options. Anyone seeking to finance growth, arrange succession, or prepare for a sale should clarify early on what requirements and risks each world entails and how to structure the transaction in a way that keeps options open.

We support our clients in M&A transactions in both worlds—that is, in both public M&A and private M&A as well as private equity transactions—and ensure that structure, documentation, negotiations, and closing fit together seamlessly. LINDEMANNLAW would be happy to work with you to assess where your project stands from a legal and procedural perspective, identify risks that are typically underestimated , and help you prepare as efficiently as possible for a successful signing and closing. If you are setting the course for growth, financing, or an exit: Contact us.

Disclaimer: This publication contains only general information and does not constitute legal advice. The assessment always depends on the circumstances of the individual case. For advice regarding your specific situation, please contact us directly.

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