The Australian flag.
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By Victor Luckerson
November 19, 2015

Facing a tepid market for tech IPOs in the United States, many startups are venturing Down Under to go public, according to a report by the Wall Street Journal. Australia has become the fifth-biggest market for tech IPOs in 2015, up from eighth place in 2014.

Tech companies are also doing reverse takeovers, in which a company that’s already publicly traded but acts as a shell company acquires the tech startup. Many of these shell companies have traditionally acquired mining businesses, but a downturn in that industry has made the businesses more keen to partner with firms from Silicon Valley.

Some U.S. companies have already found big success in Australia. An online recruitment company called 1-page did a reverse takeover of a former nickel and gold explorer called InterMet Resources last year and saw its share price rise from 20 Australian cents to A$4.33 as of Wednesday.

Still, some analysts question whether Australian brokers have the experience and expertise to adequately value tech stocks. “You wouldn’t go to a dentist to have a knee reconstruction, so why are we going into mining shells with tech stocks?” Philip Alexander, an executive director at corporate advisory firm Jacanda Capital, told the Journal.

Contact us at editors@time.com.

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