JPMorgan Chase is doing something it’s never done before: publishing equity research on a private company.
The bank is moving beyond traditional stock coverage and is starting with OpenAI — a move that reflects how dominant private companies have become in today’s markets, and how Wall Street is trying to keep up.
“This new offering aims to expand our coverage and research into private companies, where we continue to see growing influence and interest from our clients,” Hussein Malik, the bank’s head of global research, said in an internal memo. “Importantly, private companies are becoming increasingly relevant to various industries, especially in the new economy space,” the memo said.
The move comes as more company founders and boards choose to stay private longer. The median age of a private company going public has increased from 6.9 years a decade ago to 10.7 years today, according to Morningstar.
A major factor behind the decline is the surge in funding for companies like OpenAI and SpaceX, fueled by the rise of private equity and venture capital. Pitchbook estimates that there are $18.7 trillion assets in private markets, including venture capital and private equity — a figure that will reach $24 trillion by the end of 2029.
“With approximately 1,200 private companies in the US achieving unicorn status between 2020 and 2023—a notable increase from around 330 between 2016 and 2019—their growing influence on the economy and markets is clear,” Malik said in a separate memo to clients.
Malik said understanding the private markets has now become key to properly assessing publicly traded companies.
“Understanding their impact is and will remain crucial for both public and private market investors to make informed investment decisions,” he added.
Jamie Dimon has long lamented what he has called “the diminishing role of publicly traded companies in the American financial system.” In a 2023 letter to investors, he said the number of US public companies had declined to 4,300 from a peak of 7,300 in 1996.
“This trend is serious and may very well increase,” he said at the time, before asking, “Is this the outcome we want?”