Private Equity Exit Strategy Evaluation

The private equity firm Alpha Ventures has successfully invested in a technology startup, Tech Innovations, which has shown promising growth over the last four years. As Alpha Ventures approaches the end of its investment horizon, it is evaluating exit strategies to maximize returns for its investors. The two primary exit strategies considered are an Initial Public Offering (IPO) and a strategic sale to a larger technology company.

Alpha Ventures needs to assess not only the expected financial returns from these options but also the market conditions, the company’s comparative valuation, and the timing of the exit.

Given the information provided, which exit strategy is likely to yield the highest return for Alpha Ventures considering the current favorable market environment for tech IPOs?