Things were looking bleak for the Thomas Weisel Partners (NASDAQ:TWPG) IPO. One of its bankers, Goldman Sachs (NYSE:GS), bailed on the deal, and the replacement underwriters were the relatively small Keefe, Bruyette & Woods and Fox-Pitt, Kelton. Interestingly enough, CEO and Chairman Thomas Weisel was the lead underwriter on the Thomas Weisel Partners IPO. That unusual situation raised conflict-of-interest concerns; when pitching the deal to investors, would Weisel really talk about the downside?

But Thomas Weisel is a legend on Wall Street, having built Mongomery Securities from 1978 to 1998 -- and IPOs are his specialty. Mr. Weisel founded his firm in 1998 and enjoyed the dot-com boom in IPOs, having sold Montgomery Securities to NationsBank in 1997. The subsequent dot-com implosion left the IPO market barren, yet Mr. Weisel was able to survive this nuclear winter.

It shouldn't be surprising, then, that Weisel eventually pulled off a successful IPO. On the first day of trading, Thomas Weisel Partners' stock surged 33% to $19.90. The company issued 6 million shares in the offering.

Thomas Weisel Partners primarily provides investment banking services to growth companies in the technology, health care and consumer sectors. Services include IPOs, M&A, and follow-on offerings. The firm also runs brokerage operations and asset management services.

The M&A market has been surging lately, and venture capital investing has also boomed, creating additional growth in corporate transactions. But despite this healthy environment, Weisel Partners' financials are lackluster -- which may explain Goldman's reluctance to take on the deal. For the first nine months of 2005, revenues were $177.2 million, with a net loss of $14.2 million. And though the corporate finance market is picking up, Weisel must contend with heavy competition from both the big banks and upstarts like Greenhill & Co. (NYSE:GHL).

Weisel Partners made a big bet that the IPO market would make a comeback, but it hasn't happened yet. Instead, the money's gone to M&A, where Greenhill has a big focus. IPOs will ultimately come back, bringing Weisel more business, but I'd estimate that it could easily take a year or more. Until then, investors may want to do what Goldman did on Thomas Weisel: Stay away.

Fool contributor Tom Taulli does not own shares of any company mentioned in this article.