Here is a look at the steps a company can take to prepare for an IPO. Based in the Washington, D. For many growing companies, "going public" is more than just selling stock. It's a signal to the world that the business has made it. That's why undertaking an initial public offering commonly known as an IPO -- the first sale of stock to the public by a private company -- has long been the ultimate goal for many an entrepreneurial business.
By Mary Hall Updated Aug 7, Going public refers to a private company's initial public offering IPO , thus becoming a publicly-traded and owned entity. Businesses usually go public to raise capital in hopes of expanding. Key Takeaways Going public refers to a private company's initial public offering IPO , thus becoming a publicly-traded and owned entity. Going public increases prestige and helps a company raise capital to invest in future operations, expansion, or acquisitions. However, going public diversifies ownership, imposes restrictions on management, and opens the company up to regulatory constraints. Listing a Company The IPO process begins with contacting an investment bank and making certain decisions, such as the number and price of the shares that will be issued.
If you want to take your company public, there are many factors you should consider. Opening your business up to outside investors can have a big payoff, but also carries some risks. Initial Public Offering First, you will want to consult your financial firms and lawyers. They will guide you through the process of setting up an Initial Public Offering. The IPO is when you offer shares of your company to the public for the first time.
After all, if unstable or problematic companies were allowed to participate in the stock market, it would spell trouble for investors and the economy as a whole. Standards exist and are enforced in order to maintain a stable marketplace. Set a date for the offering This step towards taking a company public is pretty self-explanatory. The issuing company and the underwriting team collaborate to pick a date to initiate the IPO.