Tax software company Avalara confidentially files for US IPO
U.S. IPO activity, sluggish at the start of the year, is gaining momentum following robust investor demand for new offerings.
Avalara went public in June 2018 and was taken private in 2022, when it was acquired by private equity firm Vista Equity Partners in a deal that valued the company at $8.4 billion, including debt.
Founded in 2004, Avalara runs a cloud-based software platform that helps companies with tax compliance.
The terms of the offering were not disclosed.
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18 minutes ago
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Fed dissenters appeared alone in favoring rate cut at July meeting, minutes show
WASHINGTON, Aug 20 (Reuters) - The two Federal Reserve policymakers who dissented against the U.S. central bank decision's to leave interest rates unchanged last month appear not to have been joined by other policymakers in voicing support for lowering rates at that meeting, a readout of the gathering released on Wednesday showed. "Almost all participants viewed it as appropriate to maintain the target range for the federal funds rate at 4.25% to 4.50% at this meeting," the minutes of the July 29-30 meeting said. Fed Vice Chair for Supervision Michelle Bowman and Governor Christopher Waller both voted against the decision to leave the benchmark interest rate unchanged, favoring instead a quarter-percentage-point reduction to guard against further weakening of the job market. It was the first time since 1993 that more than one Fed governor dissented against a rate decision. Not even 48 hours after the conclusion of last month's meeting, data from the Labor Department appeared to validate the concerns of Bowman and Waller when it showed far fewer jobs than expected were created in July, a rise in the unemployment rate and a drop in the labor force participation rate to the lowest level since late 2022. More unsettling, though, was an historic downward revision for estimates of employment in the previous two months. That revision erased more than a quarter of a million jobs thought to have been created in May and June and put a hefty dent in the prevailing narrative of a still-strong-job market. The event was so angering to President Donald Trump that he fired the head of the Bureau of Labor Statistics. Data since then, however, has provided some fodder for the camp more concerned that Trump's aggressive tariffs risk rekindling inflation to hold their ground against moving quickly to lower rates. The annual rate of underlying consumer inflation accelerated more than expected in July and was followed by an unexpectedly large jump in prices at the producer level. The minutes showed officials continued an active debate on the effects of tariffs on inflation and the degree of restrictiveness in their policy stance. Several policymakers commented that the current level of the federal funds rate may not be far above its neutral level, where economic activity is neither stimulated nor constrained. Fed policymakers assessed that the effects of higher tariffs had become more apparent in some goods prices but that the overall effect on the economy and inflation remained to be seen, the minutes showed. Looking ahead, participants noted they may face difficult tradeoffs ahead if elevated inflation proved more persistent while the job market outlook weakened. Heading into the release of the minutes, CME's FedWatch tool assigned an 85% probability of a quarter-percentage-point reduction in the Fed's policy rate at the September 16-17 meeting. That rate has been unchanged since December. The minutes were released just two days before a highly anticipated speech from Fed Chair Jerome Powell at the annual economic symposium near Jackson Hole, Wyoming, which is hosted by the Kansas City Fed. Powell's keynote speech on Friday morning - set to be his last such address as head of the central bank, with his term expiring next May - could show whether he has joined ranks with those sensing the time has come for steps to shield the job market from further weakening or if he remains in league with those more wary of inflation in light of its moves away from the Fed's 2% target. The lack of rate cuts since Trump returned to the White House has agitated the Republican president, and he regularly lashes out at Powell for not engineering them. Trump is already in the process of screening possible successors to Powell. After the unexpected resignation earlier this month of one of the seven Fed governors, Trump has a chance to put his imprint on the central bank soon. The president has nominated Council of Economic Advisers Chair Stephen Miran to fill the seat recently vacated by former Fed Governor Adriana Kugler, a term that expires at the end of January. It is unclear whether Miran will win Senate confirmation before the Fed's next meeting. On Wednesday Trump demanded that Fed Governor Lisa Cook resign from the central bank over allegations of wrongdoing connected to mortgages on properties she owns in Georgia and Michigan.
Reuters
an hour ago
- Reuters
Nasdaq drops for 2nd day as AI jitters rattle tech investors
NEW YORK, Aug 20 (Reuters) - Tech stocks led declines on Wall Street, with worries about AI spurring debates about its future. The Nasdaq Composite dropped 2.2% over the last two days, the worst two-day fall since August 1st. The semiconductor index was down 1.4% (.SOX), opens new tab, while the information technology sector (.SPLRCT), opens new tab was the second biggest decliner in the S&P 500, sliding 1% on Wednesday. Market participants attributed the selloff to a range of factors including a technical pullback after driving much of the stock market's recovery in the weeks after the April 2nd "Liberation Day." Aside from AI concerns, analysts also cited deepening fears of government interference with companies, as the Trump administration looked into taking equity stakes in chip companies such as Intel in exchange for grants under the CHIPS Act. COMMENTS: CHRISTOPHER MURPHY, CO-HEAD OF DERIVATIVES STRATEGY, SUSQUEHANNA, PENNSYLVANIA: "I think it's more likely this is an overstretched pause than the beginning of a new rotation. The most notable trade midday was a seller of 20k+ Dec 100 puts as SPX rebounded sharply, suggesting investors are taking advantage of the pullback via selling puts rather than signaling a wholesale shift. For now, flows point to taking advantage of the sell-off as opposed to a clear reallocation of capital into new sectors." CHRISTOPHER VECCHIO, HEAD OF FUTURES & FOREX, TASTYLIVE, NEW YORK: "Tech stocks are sliding as investors pare back risk ahead of the Fed's Jackson Hole meeting, with traders reluctant to chase valuations higher into a Powell speech that will likely fall short of promising a September rate cut." "Fresh concerns over the durability of the AI boom, after an MIT study highlighted weak corporate returns and comments from OpenAI's Sam Altman cited excess buildout in the space, have added to the pressure." "If it's the start of a rotation, it's less of a 'growth shifting to value' or 'smalls caps over mega caps' shift and more of a 'classic defensive' posturing around economic weakness: bonds, gold, healthcare, and consumer staples are leading the way. If there was a time of the year for a pullback, it's now: over the past 10- and 20-years, the S&P 500 has averaged losses of -1.7% and -1.2%, respectively, during the August to October window." ART HOGAN, MARKET STRATEGIST, B. RILEY WEALTH MANAGEMENT, BOSTON: "Technology in general is up 40% from its April lows, and the group clearly got ahead of itself. Also, if there's anything to the market consensus that we'll see a Fed rate cut, then there will be room for other things to work as well – and there are 493 other stocks in the S&P 500 that are lagging the Mag 7 right now. So I think there's a bit of a rotation." "I don't know how long it will last, but if it does keep going, well, August and September (are) the weak period seasonally in which it could do so. Also, there are some people who are beginning to question the pace at which we need to be chasing AI capital spending. If you put all this together: when technology stocks take a breather, this is what it looks like. Nvidia and other blue chips in the group are seeing relatively steady drawdowns, but things on the speculative edge are clearly seeing more selling pressure. Palantir has gone from trading at 200 times sales to 150 times its sales, for instance." MICHAEL ASHLEY SCHULMAN, CHIEF INVESTMENT OFFICER, RUNNING POINT, EL SEGUNDO, CALIFORNIA: "Tuesday' s U.S. technology stock swoon and its continuation today looks like multiple compression meeting a little margin math, but the timing makes it hard to ignore the new elephant in the server room. Names that had been sprinting on AI dreams pulled back hard, with Nvidia, AMD, and Palantir Technologies among the drags." "DeepSeek's update landed on Tuesday represents a serious cocktail of capability and availability and traders well remember the original harsh tech-market pullback DeepSeek caused when it was first broadly recognized in January of this year." BRIAN JACOBSEN, CHIEF ECONOMIST, ANNEX WEALTH MANAGEMENT, BROOKFIELD, WISCONSIN: "When you go from rally to rout, it shows how vulnerable the names were to even a scent of bad news. It could have been (Sam)Altman's valuation warning and then Meta restructuring its AI division threw fuel on the fire." SETH HICKLE, PORTFOLIO MANAGER, MINDSET WEALTH MANAGEMENT, INDIANAPOLIS: "I think we are starting to see a little bit of rotation. It's always healthy to see a little bit of a pullback to that way, the markets can kind of get re-oriented." "To me, tech was overbought. Maybe it was justified, but it could have been kind of a buy on the rumor, sell it on the news type of thing where we had tech runup into earnings. We had really good earnings, and now it's kind of natural for the market just to sell some of that good news." "I wouldn't be surprised if we see a little bit of rotation into some smaller cap or into healthcare names, or consumer staples. And to me, that's kind of a healthy rotation. But honestly, I don't believe it will be a longer-term trend. It'll probably be a shorter-term trend. I think we'll see money flow back into tech in the next couple months." PHIL BLANCATO, CHIEF EXECUTIVE OFFICER, LADENBURG THALMANN ASSET MANAGEMENT, NEW YORK: "It's much more about profit-taking and temporary rebalancing here. If you get a Federal Reserve cut or a mention of it on Friday, this will reverse pretty quickly, but this is a lot to do with names pushed up to really lofty levels and profit taking across the board." STEVE SOSNICK, CHIEF STRATEGIST, INTERACTIVE BROKERS, CONNECTICUT: "The tech-led selloff that we saw yesterday resumed this morning. That said, dip buyers stepped in around 11am EDT and we've now recovered about half our losses. It's somewhat inevitable to expect them to arrive promptly, though it did take a bit longer than usual." "I believe that some of the early declines are related to profit-taking and risk squaring ahead of (Fed Chair Jerome)Powell's speech on Friday. That is merely rotation and relatively benign, though it gets magnified because of megacap tech stocks' heavy weighting in key indices. But some of the ferocity of the early drop was related to the President's calls for Lisa Cook's resignation." "Note that futures broke through their pre-market lows shortly after he posted on Truth Social. Markets were not perturbed that there are inquiries into the propriety of her personal mortgage applications. She gets a presumption of innocence until proven guilty, like any other person. But when the President weighed in even before the process began, then it raised the specter of politicization. That put markets on the wrong foot early, and negative momentum ruled again – at least for a couple of hours." ADAM SARHAN, CHIEF EXECUTIVE, 50 PARK INVESTMENTS, NEW YORK: "To see a little pullback here after a big move up is perfectly normal and healthy. If the selling gets worse then you'll see a rotation out of tech and into undervalued areas of the market like biotech stocks or healthcare stocks or small cap stocks because those areas have not participated this year."
Reuters
an hour ago
- Reuters
Growing trend: State AGs making investigations public
August 20, 2025 - State Attorneys General wield considerable influence through their bully pulpits, which they utilize in various ways to impact policy and corporate behavior. This article delves into a recent trend of State AGs publicizing when they initiate an investigation. As State AGs shift from traditional confidential inquiries to public disclosures, companies must adapt to mitigate potential repercussions. Traditionally, State AGs kept confidential their investigations into private companies and only publicized the existence of an investigation when the issues involved a substantial emergency or when a lawsuit had been filed or a settlement had been reached. In fact, many states have codified this custom by rendering subpoena responses exempt from open records laws, despite the presumption that records should generally be made available to the public. State AGs have recently voiced frustration with this traditional process. Keeping investigations confidential may result in companies not taking the investigations seriously and may limit the State AGs' ability to share with constituents (i.e., voters) the actions being taken to protect them. Conversely, many State AGs believe that attention from publicizing an investigation incentivizes companies to respond and to prioritize a quick settlement. Revealing a State AG's accusations can increase a company's public relations exposure, thereby forcing a company to choose between cooperation or the risk that accusations of bad corporate behavior become a self-fulfilling prophecy. Such incentivized cooperation has led to prompt settlements in several cases. For example, the Texas AG publicly announced its investigation, opens new tab into General Mills for allegedly misrepresenting certain products were "healthy," and it quickly resulted in a settlement, opens new tab just one month after the announcement. Publicizing an investigation typically occurs via a press release and perhaps an accompanying press conference. Texas and Montana are among the states that have recently followed this strategy. In fact, their releases include a link to the subpoenas and timelines by which the investigated party must respond. Publicizing an investigation is not always a winning strategy. State AGs can only publicize an investigation once, and publicizing right away means they lose the leverage to publicize (or threaten to publicize) later. Further, if a State AG announces an investigation, a company may presume that the state has already reached a conclusion about its actions, which may disincentivize a company's cooperation. The increasing trend of publicizing investigations highlights the political nature of State AG offices. State AGs are powerful figures, but they routinely leverage their positions as stepping stones to higher office. Consequently, so long as State AGs remain political figures, we expect them to use every tool available, including publicizing investigations, to advance their causes. Parties on the receiving end of this tactic must move quickly to minimize the fallout. Below are a few recommendations for managing such crises. Before taking any action, a company must understand why a State AG believed that it was appropriate and necessary to publicize an investigation. With this information, a company can better strategize its response, ensuring that it is responsive to the office's actual concerns. For instance, a company's responses differ if an investigation is prompted by a more policy-oriented issue as compared to an investigation driven by an increase in consumer complaints. The source of the concern can also allow a company to assess the regulator's goals. Therefore, the company can determine whether such concerns are limited to that state (e.g., a hospital merger), whether the concerns will be prioritized by other regulators of the same political party (e.g., ESG), or whether the concerns are a nationwide issue (e.g., consumer protection). Companies should assess whether similar issues have attracted attention from other State AGs, federal agencies, or international regulators. Additionally, analyzing recent trends in enforcement actions and settlements in the industry can provide insights into how regulators are likely to respond. By gaining a comprehensive view of the regulatory environment, companies can better anticipate challenges and opportunities, allowing them to craft a defense strategy that minimizes risks and aligns with broader compliance goals. When a state announces that it has opened an investigation, third parties, such as plaintiff's counsel, are likely to issue public records requests seeking the contents of the investigation — both during the investigation and after a resolution is reached. Accordingly, investigated companies must proactively determine the confidentiality protections that state law affords them. Numerous state statutes guarantee the confidentiality of subpoena responses, but the strength of those protections vary. For instance, some state laws require a State AG to keep subpoena responses confidential, while others provide the State AG with discretion to share the responses. In many states, the confidentiality protections afforded to a company's responses during the course of an investigation do not exist after the investigation concludes. This is why negotiating confidentiality agreements, prior to the production of responsive documents, is so important. Insisting on a confidentiality agreement provides an opportunity to negotiate an array of confidentiality issues, including who can view the responsive documents, with whom those documents may be shared, and what notice the company receives before any information is shared. Confidentiality agreements also provide the company an opportunity to tease out whether other investigations are occurring under the surface. When negotiating a confidentiality agreement, companies should consider the possibility that this information may be shared with other regulators and, in turn, used to facilitate additional investigations without the company's knowledge. Even if a company negotiates an airtight confidentiality agreement, a state's publication of an investigation means additional scrutiny from federal, state, and local regulators. It also means private lawsuits, where applicable, are likely to follow. Companies benefit by proactively establishing a plan to defend against lawsuits and investigations on multiple fronts, mindful that responses to one action may impact the outcome in others. Companies may find it more difficult to reach a resolution when a State AG publicizes an investigation and additional scrutiny follows. This is because if a company agrees to make changes or reach a resolution, other regulators and the plaintiff's bar may interpret that concession as proof that the investigation has merit and/or that the company is not inclined to vigorously litigate the issue. If a resolution is contemplated, the foremost goal is to assess the likelihood that such resolution will make it more or less likely that the company is able to achieve global peace. As a result, when entering into a settlement, a company should prepare a risk matrix of all regulators and private plaintiffs that could take subsequent action. This risk matrix should analyze the relevant statutes of limitation and historical instances where that regulator has entered into a settlement that post-dates an initial settlement from another regulatory body.
