🔥 The Impact of Iran War on Private and Public Valuations - Here's the State of the Market in March 2026

Summary by Andre Retterath | March 22, 2026

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1. Key Themes

Theme 1: The Iran War Is the Dominant Macro Shock — and Private Markets Haven't Felt It Yet

The US-Israeli war on Iran, launched February 28, has closed the Strait of Hormuz, spiked oil prices, and rattled public equities. But the real danger for private investors is the lag effect.

"Private marks lag public moves by one to two quarters, meaning the multiple compression now accelerating in public markets will show up in portfolio valuations through Q2 and Q3."

The Fed is now effectively paralyzed in a stagflationary trap:

"The stagflationary setup, rising energy-driven inflation combined with slowing growth, leaves the Fed with little room in either direction."

The binary scenario framing is critical for portfolio planning:

"The short-conflict scenario allows multiples to stabilize in H2. The extended-conflict scenario, with oil at $130/barrel in Q2, would make 2026 a genuine vintage year test for portfolios built on 2021-2023 entry prices."

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Theme 2: The IPO Window Is Effectively Closed — M&A Is Now the Only Liquidity Path

Not a single company from the top 50 IPO candidate list has gone public in 2026. M&A has filled the vacuum, with volume and deal size surging.

"The IPO window remains largely theoretical. As of March, none of the 50 candidates on our January list have completed a public listing."

"In light of very few public listings in the last few months, M&A has surged to become the more critical path for liquidity."

"M&A volume has now crossed $1.0T YTD, up from $0.7T reported through the first 7 weeks of the year."

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Theme 3: M&A Deal Size Has Structurally Inflated — Larger, More Concentrated Transactions Are the New Normal

The average M&A deal size is nearly double the prior year's full-year average — and it's not a one-month anomaly.

"The average deal size of $2,080M is the more telling number. It remains nearly 2x the 2025 full-year average of $1,094M, confirming that the shift toward larger, more concentrated transactions is structural rather than a single-month anomaly driven by last month's mega-deals."

The bifurcation between elite deals and the long tail is stark:

"Scale and strategic urgency command extraordinary premiums, while the long tail of M&A clears at disciplined multiples." (Top 10 median: 13.6x EV/Revenue vs. overall market median: 1.6x EV/Revenue)

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Theme 4: Public Multiples May Be Bottoming — Profitability Is Now the Premium Signal

After sustained compression, the median EV/NTM Revenue ticked up for the first time in months. The market is rewarding margin improvement even as growth moderates.

"The average continued to compress, but the median stabilized… The overall median also edged up from 2.3x to 2.4x, its highest reading in several months."

"At the index level, the Top 10 average EBITDA margin improved to 37% from 29% in February, while average growth ticked down slightly to 25%. Companies are being rewarded for profitability improvement even as absolute multiples compress."

"Premium multiples are increasingly reserved for companies with either extreme growth (Palantir at 55%, AppLovin at 41%) or a combination of high margins and durable revenue quality."

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Theme 5: Frontier AI and Payments Infrastructure Dominate Private Market Value Creation

Despite broad market pressure, AI mega-caps and Stripe are holding or gaining value while everything else stagnates.

"Frontier AI capital concentration unchanged from last month." (Anthropic at $370B, ByteDance at $330B, xAI at $230B)

"Non-AI names continue to hold without meaningful revaluation. The private market repricing story in March is almost entirely a Stripe story."

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2. Contrarian Perspectives

The Multiple Compression Cycle May Be Ending — Despite the War

Against a backdrop of geopolitical shock, oil spikes, and Fed paralysis, the article argues the worst of the valuation compression is likely over.

"Despite the macro uncertainty throughout the past few weeks, the sharpest phase of the correction may be ending." "Spoiler: Was this the bottom? Likely."

Evidence: The Top 10 median EV/NTM Revenue ticked up month-over-month for the first time in this correction cycle (13.1x → 13.6x), and the overall market median rose from 2.3x to 2.4x.

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Private Market Sellers Are Living in 2025 — Creating a Structural Valuation Gap That Buyers Can Exploit

While sellers remain anchored to last year's marks, buyers are pricing forward risk — creating asymmetric opportunity for disciplined acquirers.

"A valuation gap is forming between sellers anchored to 2025 multiples and buyers pricing in 2026 risk, and the IPO window is narrowing further."

Combined with the fact that only 20% of last year's IPO candidates actually listed, founders clinging to peak private valuations face an increasingly binary choice: accept a reset or stay private indefinitely.

"The question for 2026 is less about when the window opens and more about which names are willing to accept the valuation reset that public markets would impose."

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Strategic Buyers Are Paying Science-Fiction Multiples for Biotech — Signaling Deep Scarcity in Late-Stage Clinical Assets

Arcellx was acquired at 217x EV/Revenue — not because of financial logic, but because acquirers cannot afford to miss proven clinical-stage assets.

"Arcellx's acquisition by Gilead Sciences at $7.8B and 217.3x EV/Revenue is the single most striking data point, reflecting the extreme premiums strategic buyers are willing to pay for late-stage clinical assets."

This is not a pricing error — it reflects structural scarcity premium logic, consistent with prior semiconductor-adjacent deals in the same data set.

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3. Companies Identified

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4. People Identified

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5. Operating Insights

Use M&A as Your Primary Exit Planning Framework in 2026 — Not IPOs

With zero IPOs completed from a 50-company candidate list, founders and investors should be building M&A readiness (clean cap tables, strategic buyer relationships, audited financials) rather than IPO readiness. The structural shift toward larger M&A deals also means that well-positioned companies in energy, biotech, and AI have real exit optionality at premium multiples if they can attract strategic buyers.

"M&A has surged to become the more critical path for liquidity... The average deal size of $2,080M is nearly 2x the 2025 full-year average, confirming that the shift toward larger, more concentrated transactions is structural."

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Optimize for Profitability Now — Margin Improvement Is Being Rewarded Even as Growth Multiples Compress

The public market is clearly signaling a preference shift. Companies improving EBITDA margins are holding or gaining multiple premium even when overall growth slows. Operators should prioritize cost structure tightening and margin improvement in 2026, not just top-line acceleration.

"Companies are being rewarded for profitability improvement even as absolute multiples compress... The Top 10 average EBITDA margin improved to 37% from 29% in February."

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Model Two Scenarios for Your Portfolio — Short Conflict vs. Extended Conflict

The Iran war creates a binary macro environment. Investors with private portfolios should stress-test valuations under the extended-conflict scenario before Q2 marks hit.

"The short-conflict scenario allows multiples to stabilize in H2. The extended-conflict scenario, with oil at $130/barrel in Q2, would make 2026 a genuine vintage year test for portfolios built on 2021-2023 entry prices."

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6. Overlooked Insights

The xAI/SpaceX Merger Is Already Announced But Not Yet Reflected in Any Private Market Data

This is a significant structural point that most market observers will miss. Despite the merger announcement in February, xAI ($230B) and SpaceX ($800B) are still being tracked separately — meaning the combined entity's true private market weight (~$1T+) is invisible in current rankings. This data lag will eventually create a visible repricing event when providers consolidate.

"xAI remains listed separately at #6 ($230B) despite the SpaceX merger announced in February, reflecting the usual lag between deal close and data provider consolidation."

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Quantum Computing Is Quietly Commanding Semiconductor-Level M&A Premiums

IQM Quantum Computers appeared in the top M&A multiples table at 51.4x EV/Revenue — a data point that received only one sentence of commentary but carries significant investment implications for the quantum infrastructure category.

"IQM Quantum Computers follows at 51.4x, reinforcing that quantum infrastructure continues to attract premium valuations similar to semiconductor-adjacent deals we tracked last month."