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The ongoing competition between the New York Stock Exchange and Nasdaq, characterized by an increasing number of new stock listings, has resurged, underscoring a revival in the initial public offerings (IPO) market following a protracted period of dormancy.

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Recent developments reveal Nasdaq's triumph in securing the upcoming listing of Instacart, a grocery-delivery company, slated to occur before the end of the year. Furthermore, Nasdaq has effectively attracted Arm, a prominent chip designer, to its platform. Conversely, the New York Stock Exchange has successfully secured listings for Klaviyo, a marketing-automation platform, and Birkenstock, a notable German shoe manufacturer.

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Exchanges derive revenue from each transaction involving stocks on their platform, though trading volumes remain unpredictable. In contrast, listing fees offer stability and can accumulate to as much as half a million dollars annually per company. Securing significant listings also confers highly sought-after prestige.

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Nasdaq and NYSE engage in fierce competition for major IPOs, employing incentives such as elaborate marketing and advertising packages, sophisticated launch events, and the privilege of ringing the opening and closing bells. In the pursuit of Arm, which is anticipated to be the largest IPO of the year, Nasdaq reportedly extended an enticing package valued at $50 million to the British company.

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The IPO sector has endured a prolonged period of stagnation, evidenced by the lowest funds raised through traditional IPOs in 2022 over the past two decades. The early months of 2023 exhibited a similar sluggishness, with both companies and investors exhibiting hesitancy towards IPOs, partly due to the allure of more attractive investments stemming from higher interest rates and inflation.

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While this momentarily abated the rivalry for listings, recent months have witnessed a renewed surge in competition between the two exchanges.

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Presently, the New York Stock Exchange holds an advantageous position over its rival. Data from Dealogic through early August shows that traditional IPOs on the NYSE have amassed approximately $6.5 billion in funds raised this year, surpassing the $3.7 billion garnered on Nasdaq. Should this trend persist, the New York Stock Exchange will break Nasdaq's four-year streak of dominance.

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Prominent recent IPOs include the Mediterranean restaurant chain Cava Group, which experienced a doubling in value during its debut on the NYSE in early June.

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Anticipated upcoming IPOs comprise significant entities such as Arm, Klaviyo, and Birkenstock, potentially launching as early as September. Arm aims for a valuation exceeding $50 billion, while Birkenstock pursues a valuation of over $7 billion. Klaviyo is projected to target a valuation surpassing $5 billion, as indicated by insiders. Instacart recently updated its internal valuation to approximately $12 billion. These developments could lay the groundwork for a steady influx of new issuances in 2024, according to insights from bankers, legal experts, and investors.

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