Tying It All Together
James05
GoingPublic-1.pptxGoing Public
Objectives
Pros & Cons of going public
Overview of IPO process
Registration statement
Pros & Cons of Going Public
Pros
Raise more capital at higher valuation than private offerings
Founders and early investors can liquidate their shares at many times initial value
Access to public funding and broader financial markets
Pros & Cons of Going Public
Cons
Expensive
Heightened legal obligations
Disclosure requirements
Restrictions on sale of stock
IPO Process
Drafting preliminary registration statement and prospectus
Preliminary prospectus reviewed by SEC
Pre-effective amendments based on SEC comments
Road show
Final prospectus
Registration Statement
Required by securities regulations
Importance of due diligence
Liability for misstatements or misrepresentations in registration statement
Absolute liability for company
Due diligence defense may be available for directors/officers
Summary
Going public allows access to broader financial markets, but requires heightened obligations and expense
Seek professional legal advice to determine if and when your business may be a viable candidate for IPO and throughout the IPO process
