Key Factors in Ipo
Key factors in IPO
1. Effective management team
As a company prepares for its IPO, it must expand its management capabilities. Who runs a company is what sells the IPO. Investors expect to see very knowledgeable, experienced professionals who are committed to the long-term success of the company. Thus, the company has to hire some individuals with public company experience in marketing, operations, development, and finance. And the company may also put in place a CFO, who has previously been through the IPO process.
2. Good underwriter
A good investment banker is critical for the IPO. The underwriter will draft prospectus, assist with the filing, find investors, determine the offering price and sell the stock. Thus the company should conduct due diligence on a number of underwriters to assess which one is the right for it. And the company can find an underwriter that specializes in the company’s own industry, through this way the whole IPO process will go smoother.
3. Thorough IPO readiness assessment
As company prepare for an IPO, an IPO readiness assessment can be useful to identify the big-picture issues and prevent the problems that will lead to the failure of the IPO. Besides, the IPO readiness assessment also helps the company to establish a timetable based on the actual work that needs to be done in the whole IPO process.
4. Early established IPO structure
Successful IPOs determine the IPO structure at the beginning of the process. Existing stakeholder concerns must be tackled early. While it is difficult to finalize and document the details for all of these terms at the start of the project, the more complete the offering structure is at the start of the project, the more efficient the project will be. Changing the structure or primary transaction dynamics during the process can cause significant delays and can have legal, tax, and financial reporting surprise implications.
5. Positive public image
A positive image can enhance the initial sales effort
1. Effective management team
As a company prepares for its IPO, it must expand its management capabilities. Who runs a company is what sells the IPO. Investors expect to see very knowledgeable, experienced professionals who are committed to the long-term success of the company. Thus, the company has to hire some individuals with public company experience in marketing, operations, development, and finance. And the company may also put in place a CFO, who has previously been through the IPO process.
2. Good underwriter
A good investment banker is critical for the IPO. The underwriter will draft prospectus, assist with the filing, find investors, determine the offering price and sell the stock. Thus the company should conduct due diligence on a number of underwriters to assess which one is the right for it. And the company can find an underwriter that specializes in the company’s own industry, through this way the whole IPO process will go smoother.
3. Thorough IPO readiness assessment
As company prepare for an IPO, an IPO readiness assessment can be useful to identify the big-picture issues and prevent the problems that will lead to the failure of the IPO. Besides, the IPO readiness assessment also helps the company to establish a timetable based on the actual work that needs to be done in the whole IPO process.
4. Early established IPO structure
Successful IPOs determine the IPO structure at the beginning of the process. Existing stakeholder concerns must be tackled early. While it is difficult to finalize and document the details for all of these terms at the start of the project, the more complete the offering structure is at the start of the project, the more efficient the project will be. Changing the structure or primary transaction dynamics during the process can cause significant delays and can have legal, tax, and financial reporting surprise implications.
5. Positive public image
A positive image can enhance the initial sales effort