Mid-Market Companies Go Public: IPO Strategies Rebooted

8 Min. Reading Time

Ottobock, a 100-year-old family-owned business and global leader in prosthetics, went public in October 2025 – and was oversubscribed. PFISTERER, a niche market leader in energy grid connection technology from Winterbach near Stuttgart, moved to the Scale segment in May 2025 and was awarded “Outstanding IPO of the Year” at the IPO Night 2025. At the same time, the total number of listed companies in Germany fell from 761 in 2007 to 435. SMEs can go public. They just don’t do it often enough.

Key Takeaways

The numbers are clear: Germany is losing listed companies. There were 761 in 2007, and 435 in 2024. A halving in less than 20 years.

Why Germany is Losing Listed Companies

The numbers are clear: Germany is losing listed companies. There were 761 in 2007, and now there are 435 in 2024. A halving in less than 20 years. Every year, more companies leave the regulated market than new ones join. In 2021 and 2022, 10 to 12 issuers delisted or downlisted. The reasons: too high compliance costs, too low trading volumes with a small free float, and a regulatory environment that burdens listed companies more than non-listed ones.

2025 was the weakest IPO year since 2020, with only three new listings and an issuance volume of 1.186 billion Euro. PwC capital markets expert Stephan Wyrobisch called 2025 a “disappointing IPO year that will go down in history.” His colleague Dirk Menker pointed to the “difficult, uncertainty-prone situation” of the German economy.

The global contrast highlights Germany’s problem: worldwide, the IPO market grew by 44 percent to $190 billion in 2025. Europe as a whole saw 125 IPOs with a volume of $19.1 billion in 2024 – 41 percent more than the previous year. Germany played no significant role in this revival. The Frankfurt stock exchange is losing international appeal, while Amsterdam, Paris, and even Madrid are attracting IPOs that historically would have gone to Frankfurt.

The reasons for German SMEs’ reluctance to go public are cultural and structural. Family businesses think in generations, not quarterly targets. The fear of losing control to external shareholders runs deep. Transparency requirements like ad-hoc announcements and half-yearly reports are a cultural shock for entrepreneurs used to keeping their figures under wraps. Around 40 percent of listed companies in Germany are still family-owned, according to a study by TU Munich – but the net decline shows that families are turning their backs on the stock exchange rather than the other way around.

Sources: PwC IPO statistics 2025, EY IPO Barometer Q4 2024, TheGlobalEconomy.com

Ottobock: How a 100-year-old family business takes to the stock market

Ottobock’s IPO in October 2025 proves that family businesses and stock exchange listing don’t have to be mutually exclusive. The company from Duderstadt, founded in 1919 by Otto Bock, is a global market leader in prosthetics and orthopedic technology. Revenue in 2025 was 1.60 billion Euro (up 11.7 percent). The IPO in the Prime Standard was priced at the upper end of the range (66 Euro) and traded at 72 Euro on the first trading day – up 9.1 percent.

The market capitalization was around 4 billion Euro. Anchor investors like Klaus Michael Kühne (125 million Euro) and Capital Group (115 million Euro) signaled confidence. The order book was oversubscribed. For a family business that had grown for over a century without capital market financing, this was a strong debut.

What makes Ottobock relevant for other mid-sized companies: the company hasn’t given up its family identity. The Näder family (grandchildren of the founder) retained a significant stake. The EQT fund (minority stake since 2017) used the IPO for a partial exit – but not a complete one. The model: capital market as growth financing, not as loss of control. This is the lever that the CFO can use as a driver of transformation.

RENK and PFISTERER: Two paths to success

RENK Group from Augsburg, a defense supplier specializing in drive technology, went public in February 2024. Issue price: 15 Euro. Thirteen months later: 37 Euro – a gain of 149 percent. Revenue in 2024 was 1.1 billion Euro (up 23 percent), order intake reached a record 1.4 billion Euro, and the order backlog was 5 billion Euro. In March 2025, RENK was included in the MDAX.

RENK shows how important timing and sector momentum are. The defense boom after the Ukraine war and European rearmament programs created an environment where a defense supplier IPO was almost guaranteed to be successful. This is not a replicable strategy for every company – but it shows that German mid-sized businesses are in high demand on the capital market if the story is right.

PFISTERER Holding from Winterbach near Stuttgart chose a different path in May 2025: the Scale segment of the Frankfurt Stock Exchange. Issue price 27 Euro, first price 30 Euro (up 11 percent), market capitalization around 489 million Euro. The family business, a specialist in energy grid connection technology, achieved revenue of around 450 million Euro (up 17 percent) and was awarded the “Outstanding IPO of the Year” prize at the IPO Night 2025. PFISTERER proves: the Scale segment works as an entry point for mid-sized companies that don’t (yet) want the fully regulated market.

Warning Examples: Douglas and innoscripta

Not every mid-market IPO is a success. Douglas, the perfume chain, went public in March 2024 – driven by private equity investor Advent International, which was seeking an exit. The issue price was 26 Euro (lower end of the range). On the first trading day, the share price fell by 12 percent to 22.80 Euro. As of April 2024: around 19 percent below the issue price. The reasons: high debt from the PE phase, weak consumer sentiment, and a business model (stationary retail) that did not convince investors.

innoscripta, a Munich-based SaaS company for R&D funding consulting, entered the Scale segment in May 2025. The valuation: around 1.2 billion Euro at an issue price of 120 Euro and an EBIT margin of 61 percent. That sounded convincing. However, the share price fell significantly after the IPO. Investors realized that innoscripta was structurally more of a consulting company for funding than a scalable software platform. The slowdown in growth was not adequately communicated during the bookbuilding process. The lesson: valuation narratives only work as long as the substance is right. Writing “SaaS” on the facade is not enough if the underlying business model is different.

The Scale Segment: The Underestimated Mid-Market Path

The Scale segment of the Deutsche Börse, established in 2017 as a successor to the Entry Standard, is for many mid-sized companies the most pragmatic way to access the capital market. The requirements are lower than in the Prime Standard: minimum market capitalization of 30 million Euro, minimum free float of 20 percent or one million shares, at least two years of company existence. Mandatory is the cooperation with an approved “Capital Market Partner” and the publication of research reports commissioned and paid for by the Deutsche Börse.

The attractiveness lies in the reduced compliance effort: no quarterly reporting obligation in full scope, no IFRS requirement (HGB is sufficient), lower costs for IR and general meeting. For a family-owned company with 100 to 500 million Euro in sales that wants to raise growth capital without exposing itself to the full regulatory requirements of the Prime Standard, Scale is a well-thought-out compromise.

PFISTERER has shown that the compromise works: 489 million Euro market capitalization, successful IPO, and an award as the best IPO of the year – all in the Scale segment. For the typical Hidden Champion with a niche market leader position and solid growth, this is a more attractive model than the classic Prime Standard IPO.

SPACs: Rise and Fall of a Hype

The SPAC wave (Special Purpose Acquisition Companies) never really reached Germany. In the boom year 2021, when 632 SPAC IPOs took place in the USA with a volume of 138 billion dollars, there were only four in Germany. More than 50 percent of the US SPACs from 2021 were liquidated by the end of 2023. The Anglo-Saxon model of the “blank check IPO” does not fit with the German stock corporation law tradition, which offers less flexibility for the typical anti-dilution structures.

For German mid-sized companies, the classic IPO is the better way – and that is not a weakness, but a strength. The SPAC boom has shown what happens when speed becomes more important than substance: exploding losses and reputational damage for all parties involved. The valuation discipline enforced in a classic bookbuilding process protects both the company and the investors.

Private Equity as an IPO Driver

Private equity is playing an increasingly important role as an IPO catalyst for German mid-sized companies. According to the EY IPO Barometer Q4 2024, PE/VC portfolio companies accounted for only 12 percent of all global IPOs by number – but 46 percent of the issuance volume. The large deals are coming from the PE sector.

In Germany, both Douglas (Advent International) and RENK (KKR/Triton) were PE-driven IPOs in 2024. In 2025, Ottobock was a partial EQT exit. The German PE market recorded divestments of around 3.3 billion Euro in 711 transactions in 2024. There is a significant PE overhang: many portfolio companies are waiting for better IPO windows. If the market environment improves in 2026, this could trigger a wave of PE-driven mid-market IPOs.

The question for CEOs and shareholders: is a PE-driven IPO a model for their own company? The answer depends on the starting position. Those who need growth capital and are willing to accept transparency and governance standards will find a well-thought-out path in the combination of a PE phase (professionalization) and subsequent IPO (capital market readiness). However, Douglas shows the risk: if the PE phase leaves too much debt, the IPO is reduced to a balance sheet restructuring – and the market punishes that.

What CEOs Need to Know for an IPO

Timing isn’t everything, but it’s close. RENK benefited from the defense momentum, while Douglas suffered from weak consumer sentiment. Dr. Martin Steinbach of EY estimated “up to 10 IPOs in Germany” for 2025 as possible at the end of 2024 – in reality, there were three. Macroeconomic uncertainty determines the IPO window more than individual company quality.

Scale before Prime. For companies with 100 to 500 million Euro in revenue, the Scale segment is often the smarter entry point. Lower costs, fewer reporting obligations, and the option to upgrade to the Prime Standard later when the company has reached the necessary size and maturity.

Valuation discipline beats ambition. Springer Nature priced in the middle of the range in 2024 and started with a 6.7 percent gain. Ottobock priced at the upper end and started with a 9.1 percent gain. Douglas priced at the lower end and still fell 12 percent. The lesson: it’s better to price conservatively and rise on the first trading day than to price aggressively and fall. The first price sets the market perception for months.

The story must hold up. Ottobock had “global prosthetics leader”. RENK had “defense boom”. PFISTERER had “energy transition infrastructure”. innoscripta had “SaaS” – but that wasn’t true. CEOs must critically examine their equity story: can an analyst understand in three sentences why this company should be listed?

The outlook for 2026 is cautiously optimistic. PwC considers 5 to 10 IPOs to be realistic. Names like KNDS (defense, dual listing Frankfurt and Paris), Mobile.de (valuation up to 10 billion Euro), and Vincorion (defense) are in the pipeline. The defense sector is establishing itself as a new IPO driver in Germany – a shift that would have been unthinkable three years ago. For mid-sized companies, this means: the IPO window will be more open in 2026 than in 2025. But it will only be open to companies that have done their homework – in governance, valuation discipline, and equity story.

Frequently Asked Questions

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Source title image: Pexels / Anna Nekrashevich (px:6801648)

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