Direct listing is the norm in many countries around the world for decades. In India for example it is called book building and is the norm since ~1998. The aver

Direct listing is the norm in many countries around the world for decades. In India for example it is called book building and is the norm since ~1998. The average underwriting fee is 1-2% and academic studies have calculated that underpricing came down substantially from fixed price IPOs. The US is late to this shift but understandable as the US has the some of the oldest and largest markets which are resistant to change. The same process happened in the shift to electronic trading where US exchanges were the last to fully embrace electronic trading - looking at you NYSE ;) Also remember the big banks owned seats on the exchanges and the exchanges in turn and that removed any incentive for the exchanges to push for direct listings. The exchanges are now publicly traded entities so there incentives are no longer aligned. The pearl clutching by institutional investors at this change is surprising. Perhaps they are chafing at losing preferential access to IPO allocations and having to compete with the rest of the retail investing public.