Credit Downgrade May Damage Tech Sector IPO Prospects

While the U.S. tech sector has been something of a lifeboat for investors since the recession began, its seemingly constant stream of growth and IPO activity may be checked by recent turmoil on wall street.

Last week's downgrade of the U.S. credit rating by Standard & Poor's may have been enough to discourage or postpone a number of tech sector public offerings, as investors scurry to invest in havens such as gold or commodities.

"Timing is everything and it's a pretty safe bet that it will be awhile before the markets settle down enough that we can start doing (initial public offerings) again," Paul Saffo, managing director at investment consultant Discern Analytics, told the San Francisco Chronicle.

In the wake of the downgrade, few tech giants were spared, as Google, Microsoft, Apple, LinkedIn, Oracle and Pandora all saw losses.

However, one economic voice has an optimistic view of the situation. Former Treasury Secretary Henry Paulson told The New York Times that the S&P credit downgrade to AA+ may reflect fiscal performance in Washington, but U.S. Treasuries are still a safer bet than many other AAA ratings.