| A company can raise capital by going public. When a | | | | symbol in its listing at a future date. |
| company goes public, it means that the company is no | | | | In order to go public, a registration statement must be |
| longer a privately owned company. Instead, a | | | | filed with the SEC. When the SEC declares that a |
| company that goes public will give up equity in the | | | | registration statement is effective, the waiting period is |
| company and offer that percentage for sale. An | | | | over. When a company goes public through a reverse |
| investment firm or stock exchange will make the sale | | | | merger, it may take as little as two months while going |
| of the company's stock to the public. Investors make a | | | | public directly can take up to six months. Once a |
| profit from buying and selling company stocks. | | | | registration statement is declared effective, it goes |
| A company must be prepared to go public. During the | | | | through the post effective period. |
| pre-filing period, a company should inspect its | | | | A business may go public during its start up phase if it |
| corporate organization, operations, personnel and | | | | shows that it has enough potential for significant |
| governance. Tasks related to the company's stock | | | | growth and a profitable valuation to gain the |
| structure, articles of incorporation, relocation and | | | | underwriting services of an investment firm. Such a |
| intellectual property should be identified and executed. | | | | start up company can gain the capital it needs to |
| Other considerations that require attention are related | | | | become a successful business. It is important to find an |
| to legal issues, loans, borrowing money, mergers, | | | | investment firm that caters to similar sized companies |
| acquisitions and stock issuances. During this period, it is | | | | and has experience with such companies. |
| important to strategize the pre-filing publicity campaign. | | | | Public companies have greater market value than |
| The company should become familiar with the | | | | privately owned companies. With a public company, it |
| registration statement. | | | | becomes easier to raise a substantial amount of |
| Accurate and timely accounting procedures are an | | | | capital both privately and publicly because of the |
| important factor in going public. Companies must | | | | added prestige. When a company sells company |
| provide financial statements that are reviewed and | | | | stock, it can use the financing to expand the company |
| audited according to SEC requirements and any other | | | | or enable the company to participate in more |
| necessary related documents. The amount of | | | | marketing activities. The capital may fund inventory, |
| revenues made will determine how many years back | | | | research and development or be added to the |
| that the company must provide in financial statements. | | | | accounts receivable. |
| A company has the opportunity to develop its own | | | | The extra attention can give a company a much |
| stock symbol. When a registration statement is | | | | needed boost into the public eye and pocket. Going |
| declared effective, the company can be identified in its | | | | public adds value to a company, which makes it much |
| stock listing by the stock symbol. The stock symbol | | | | easier tor a company to raise capital for different |
| may not have any similarities with the company logo or | | | | purposes. |
| name. A company may change its name or stock | | | | |