Thursday, October 20, 2016

The Things You Should Know Before Your Company Go Public

From People's United Bank:


Your business is growing, but not as quickly as it could and you know it. You need capital to fuel expansion - to move into new markets, hire more staff, increase service and product offerings and grow more profitable with ever-expanding margins.


Instead of borrowing expansion capital, maybe it's time to consider going public - selling ownership shares of your business to the public.


But going public isn't as easy as simply offering stock to outside investors. Your business needs a solid track record of profitability, increasing revenues and reasonable margins in a healthy, growing industry or market sector. Investors want to see a strong management team, a vibrant corporate culture, a sound business infrastructure and growth potential. Lots of growth potential!

 
From Investopedia:


An initial public offering (IPO) is the first sale of stock by a company. Small companies looking to further the growth of their company often use an IPO as a way to generate the capital needed to expand. Although further expansion is a benefit to the company, there are both advantages and disadvantages that arise when a company goes public.


There are many advantages for a company going public. As said earlier, the financial benefit in the form of raising capital is the most distinct advantage. Capital can be used to fund research and development, fund capital expenditure or even used to pay off existing debt. Another advantage is an increased public awareness of the company because IPOs often generate publicity by making their products known to a new group of potential customers.










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