Kendall Jenner

When Millennial-focused e-commerce site Revolve quietly revealed its registration statement for an initial public offering in September, everything looked rosy.

The stock market was trading at record highs and British fashion site Farfetch had just whetted investors’ appetite for stocks at the intersection of fashion and tech, garnering $8 billion valuation out of the gate.

Hopes were high that 2019 would see the likes of Uber, Lyft, Pinterest and a large backlog of unicorns score some of the largest-ever IPOs.

And it wasn’t just the new, high-tech kids on the block expected to make the scene. Jeans maker Levi Strauss & Co., which was founded in 1853, was said to be readying itself again for the public arena with an eye toward raising up to $800 million.

But a lot can change in just a few months and it certainly has in the IPO sphere. Farfetch, for instance, has seen its value sink back to $5.9 billion. And companies wanting to go public face two major hurdles on the road to market.

The first is the partial government shutdown, now in its fourth week and showing no signs of abating as President Trump and Congress remain embroiled in a bitter feud over funding for a wall at the southern border.

The Securities and Exchanges Commission is running on a skeleton staff and not reviewing filings as a total of 800,000 federal workers are either at home and idle or working, but not getting paid.

And when Washington gets back to work after the partial shutdown, the issue will not be solved immediately because there will be a big backlog. Pat Healy, who runs IPO advisory service Issuer Network, said this is going to affect first-quarter IPO volumes.

“It’s not like you turn the lights on and everything is fine again,” he said. “You’re going to have to go through a dig-out process here. You’ve got roughly a month of backed up filings. It’s going to take a while to burn that inventory off. In addition to once they’re open for business again, you’ve got new filings coming in.”

That’s not the only wrench in the works right now, with the markets having been on a roller-coaster ride over the past few months, with the Dow Jones Industrial Average falling 5.2 percent over the past three months to just over 24,370, leaving some questioning if now is really the best time to take the plunge.

While the market volatility appears to have calmed somewhat in January, for retailers, a less-than-impressive set of holiday results also spooked investors, causing some retail stocks to tumble.

In the last month alone, ASOS and Farfetch have seen their stock slide 31 and 17 percent respectively, while Stitch Fix has tumbled 22 percent over the past three months.

“This was already challenging timing from a valuation prospective and the shutdown simply adds to that challenge because of not being able to get registration statements effective,” said Healy. “You’ve got two dynamics working against the IPO pipeline here. One is the shutdown. The other is volatility in the market.”

Kathleen Smith, a principal at Renaissance Capital, a provider of institutional research and IPO-themed ETFs, said since there has been a lot of private capital available lately, it might be that some of them wait longer to come out because the market is not as robust as they like.

For those still planning on pushing ahead, Smith thinks they’ll be in a crowded market thanks to the backlog, which could leave investors in the driver’s seat because there will be so much choice.

“It may be a little hard on the companies that are trying to come in all at once and will mean the investors could be picky and could call the shots as opposed to the companies,” she said.

According to Natalie Kotlyar, who leads the retail and consumer products practice at BDO, for those retailers who wanted to go public in the first half, pushing that back to later in the year either because of the shutdown or market conditions or both will pile pressure on them to continue to perform strongly and have the positive story to have a successful IPO.

“You always want to do an IPO on a positive,” she said.

As for whether the shutdown is an argument against listing in New York, Richard Breeden, a former SEC chairman, told CNBC this week that people around the world look at the shutdown and say “this has to be the stupidest way to run a railroad that anyone has ever invented.”

“It’s a spectacle that suggests that partisanship in Washington is having graver knock-on effect in the economy,” he said. “On the other hand those other exchanges don’t have the liquidity we have and right now the functioning of market is OK. We had far worse problems with what we went through in December.”