Thinking about IPO. Investment people inside please.
My partners and I are considering going public with our company. We feel that we are in the right industry at the right time and have experienced excellent growth. We are also in negotiations with a company that manufacturers the equipment that we use out in the field about a possible merger. If this goes through we are going public for sure.
Where is the best place to learn about IPO. We will obviously be hireing professionals to handle this for us but I need to be educated on the process. Is there a good book or website out there?
Any suggestions/direction will be greatly appreciated.
I can help you with this if you are serious. If you don't have at least $1 M liquid to flush, don't bother even talking as it isn't going to work. I have an extensive network of folks I could hook you up with, but if you are just window shopping, go onto Google or I could get you a consultant that specializes in this, but even when I consult it is $250/hr and some of the heavy hitters cost a lot more than that. My friend is the CEO of IPOFinancial.Com and I am a member of Wharton Alumni of New Jersey, so I have some hooks ups in this area. Send a PM if you want of exactly what you are looking for and be as specific as possible, and I will help you at least in a direction. Gary
__________________
I am responsible, live within my means, give to charity, save money, so where the fuck is my bailout? FUCK THESE IDIOTS KILLING THE USA PRINTING MONEY!
04mystic, this is my layman advice, based on what I have seen at InfoSpace going public.
You probably need some very solid people in your company:
- Chief Financial Officer
- Top notch inhouse legal counsel
- Eloquent CEO.
You'll have to write up hundreds of pages of legal material for the prospectus, and keep that updated quarter to quarter until you go public.
The market royally stinks, I don't think now is the good time to go... November or later, maybe, only if things look better. But don't worry, you'll need a good 6mo to prepare things if this is your first time, so you'll probably shooting for March 09 or something.
You'll need to find investment bankers ready to go along with your story and be the underwriters of your offering. People like UBS.
Then you'll go on a grueling -I mean insane- road show for 2 weeks and meet with dozens of investors to sell your company and your story.
Your company bette be good, with good management and a great story, otherwise you might be better off enjoying the peace of being private.
Private companies call their own shots.
Once you're public, it's the big circus. People stick their nose in your business all the time because it's now their business too. The smallest crap can take epic proportions.
Excitement and momentum can make your stock rocket up, and then when it falls down -laws of gravity- people will flee and you're fucked.
I recommend you think long hard. Going public is a major headache, and a big gamble.
Thanks for the info. This is very helpful. I truly believe we have a powerful team. It consists of people that have very strong back grounds. Our CEO spent many years in the military and had very high clearence. He is also a former head of security for the DOE. We have two industry professionals that are the President and COO of the company. We have 1 of the top two researchers in the industry as our director of research. The other person is at a university so technically he is not in the industry. We have strong relationships with other companies also.
We just received an L.O.I. from a fortune 100 company to do a possible project together. We have one of the best equipment manufacturers in the industry interested in doing a possible merger with us. We are an alternative energy company that has two divisions. One is energy conservation, the other power production.
There are alot of people wanting to invest in renewable energy right now. We have a proven track record in a proven industry. What turned our focus to this is we see several renewable energy companies out there that claim to be doing great things when all they are doing is making shell companies and doing little small stuff here and there. They are cons and are trying to work the system. Bad thing is, they are making money.
Therefore we feel as a well known and trusted company we should be pretty successful going this route. But we have alot to learn over the next several months, so we will see.
I've been through several IPO's in the last 15 years. The recent Sarbanes-Oxley Act has changed the process dramatically. Before the bubble of 2000, companies could go public with just $10 - 20 million in revenue. Now you need $50 - $75 million for the investment bankers to even look at you.
SOX now costs a private company about $2 million to $5 million in preparation to go public.
Why the need for an IPO? Expansion? Original investors want liquidity?
As a public company, you'll have to have stable growth numbers quarter after quarter or your stock value will get hammered.
If you are an officer in the company and are thinking of cashing out, you can forget it. Your stock options will come with a lot of restrictions and will only see the light of day long after the IPO dust settles.
I'd stay private as long as I could in this market. Much easier to survive the bumps in the road ahead.
Remster and Ray posted solid advice, and I sent a long PM to Mystic. Hell, this is the first time on the Alley I saw everyone agree-lol. I am a small NJ S Corp that is growing and will remain that way until I am forced to go into C status but that is years away. Going public for me-HELL NO the scrutiny of having a zillion people go over my #'s and books questioning what I did or why would kill me.
I've been through several IPO's in the last 15 years. The recent Sarbanes-Oxley Act has changed the process dramatically. Before the bubble of 2000, companies could go public with just $10 - 20 million in revenue. Now you need $50 - $75 million for the investment bankers to even look at you.
SOX now costs a private company about $2 million to $5 million in preparation to go public.
Why the need for an IPO? Expansion? Original investors want liquidity?
As a public company, you'll have to have stable growth numbers quarter after quarter or your stock value will get hammered.
If you are an officer in the company and are thinking of cashing out, you can forget it. Your stock options will come with a lot of restrictions and will only see the light of day long after the IPO dust settles.
I'd stay private as long as I could in this market. Much easier to survive the bumps in the road ahead.
I've been through several IPO's in the last 15 years. The recent Sarbanes-Oxley Act has changed the process dramatically. Before the bubble of 2000, companies could go public with just $10 - 20 million in revenue. Now you need $50 - $75 million for the investment bankers to even look at you.
SOX now costs a private company about $2 million to $5 million in preparation to go public.
Why the need for an IPO? Expansion? Original investors want liquidity?
As a public company, you'll have to have stable growth numbers quarter after quarter or your stock value will get hammered.
If you are an officer in the company and are thinking of cashing out, you can forget it. Your stock options will come with a lot of restrictions and will only see the light of day long after the IPO dust settles.
I'd stay private as long as I could in this market. Much easier to survive the bumps in the road ahead.
Our reasons are that we feel we have a 3 to 5 year window before everyone is jumping on the bandwagon. We also think that there is going to be alot of speculation and we want to catch that wave. You guys are bringing up some very interesting points. Please keep it going.
Ray made a good point, we're in the midst of getting a PE Fund started, but I've dealt in capital debt/equities markets, seen quite a few companies who wanted to go public and even had some of the calls myself and mainly ended up being the ceo/owner wanting to cash out on a big pay day.....like Ray said they will nail your balls to the chair with restrictions lol.
04mystic, all is not lost. You have a great company, you're in a hot sector, just keep at it, and you'll have the profits for yourself.
There are always private investors, you don't need the Mom&Pop ones to grow.
It's a lot easier to deal with 2 dozen private investors than with the whole hooplah of being public.
InfoSpace raised capital privately for a while before going public.
That gives you the oxygen you need, with less hassle, and at the same time if your company's numbers are progressing well, this establishes a trend/base for your valuation, and is very helpfup if later you go public.
Also, be aware that going public involves a very draconian quiet period. You can't talk about numbers, prospects, anything. All the stuff you talk about here would be absolutely against the rules of going public... so just make sure to clam up and only deal with advisors that are part of your "going public" crew. Nothing can leak out.
The information available to future investors have to be carefully filtered out to avoid misrepresenting the strength of the offering, and to avoid giving more information to some versus others... (this relates to unfair insider trading, equality between all shareholders, etc... stuff the SEC will be very keen on).
Your inhouse legal counsel will regularly chew you up (and your family, and all employees) on keeping quiet... get used to it :-)
It doesn't sound like you really want an IPO. IPO is more about achieving hyper growth and achieving liquidity for your early investors. If those aren't needed, no need to put yourself thorugh it.
There's a lot of money out here goin into clean energy and you can bet those VC backed companies will go IPO if there's a market for them. In that industry I would work on your merger and build the company up and sell it to one of the big guns if you want an exit.
FUCK THESE IDIOTS KILLING THE USA PRINTING MONEY! 
Linear Mode
