JPMorgan Enters Private Company Coverage Amid Growing Opportunity and Influence

JPMorgan Chase is expanding its research coverage to include privately held companies, starting with a report on OpenAI. The move reflects the growing influence of private companies in today's markets and the shrinking number of initial public offerings (IPOs). The bank's head of global research, Hussein Malik, said private companies are becoming increasingly relevant, and understanding their impact is crucial for both public and private market investors.

Title: JPMorgan Chase Expands Research Coverage to Private Companies

JPMorgan Chase & Co. has announced the expansion of its research coverage to include privately held companies, with an initial focus on AI and software sectors. This move underscores the growing influence of private companies in today's markets and the shrinking number of initial public offerings (IPOs).

The bank's head of global research, Hussein Malik, stated that understanding the impact of private companies is crucial for both public and private market investors. JPMorgan's first report in this new coverage area is on OpenAI, a leading AI startup. Unlike traditional equity research on public firms, JPMorgan's new offering will not include ratings, price targets, or estimates for private companies. Instead, the goal is to provide structured information and tracking to investor clients.

Private companies are increasingly pivotal in shaping the growth and outlook of industries, according to Malik. The number of startups with a valuation of $1 billion or more has grown significantly, with nearly 1,500 such firms worldwide. However, these companies often fall through the cracks of Wall Street analysts due to limited financial information and a focus on public markets. Several banks, including UBS Group AG, have started private company research to address this gap.

The trend of companies staying private longer or indefinitely is not new. High-profile companies like SpaceX, OpenAI, and Stripe have chosen to remain private, securing funding from private equity and venture capital firms instead of going public. This shift reflects a deeper transformation in how companies fund growth and where investors can find it. The number of publicly listed U.S. companies has fallen by about half since the mid-1990s, and the pace of IPOs has declined sharply in recent years.

For individual investors, this trend presents a challenge in accessing growth investments. Traditional access to private equity has historically been limited to institutional and high-net-worth individuals. While some options like private equity ETFs can mimic private equity exposure, they may not be enough to fill the gap.

JPMorgan's expansion into private company research is part of a broader trend in the financial industry. Alternative asset manager Pollen Street Capital has also raised significant funds for its private equity strategy, targeting mid-market deals in Europe. The firm's Private Equity Fund V raised €1.5 billion, exceeding its initial target of €1 billion, and drew in an additional €500 million of associated co-investment capital.

The move by JPMorgan Chase reflects the evolving landscape of the financial markets, where private companies are playing an increasingly significant role. As the number of IPOs continues to decline, understanding the dynamics of the private market becomes essential for investors.

References:
[1] https://www.bloomberg.com/news/articles/2025-07-18/jpmorgan-expands-research-to-private-firms-starting-with-openai
[2] https://www.investopedia.com/companies-opting-out-of-stock-market-11757107
[3] https://www.bloomberg.com/news/articles/2025-07-18/pollen-street-raises-2-billion-for-private-equity-strategy