Considering an IPO? It’s a big decision.
Key questions to ask yourself include:
Will the market regard you as an attractive IPO candidate?
A company that is ready for an IPO usually needs:
- A leading market position with a compelling investment thesis
- An attractive financial model
- Appropriate and foreseeable revenue growth and profitability
- An established quarterly forecast process and reliable financial reporting controls
- A proven management team
- A robust corporate governance framework
Are you ready for life as a public company?
You will need the appropriate people, culture, policies and processes to comply with your reporting and compliance obligations. This can mean major changes in the way you run the business and might require that you add new employees with different skills.
Are your financials ready for prime time?
The SEC’s financial statement requirements impose reporting obligations on top of what is already required by US GAAP for private companies. SEC rules for auditor independence for public companies might also mean you will need to change auditors.
Do you have the right law firm in your corner?
A strong, experienced legal team can significantly reduce the burden of the IPO drill on management and allow you to keep an eye on running the business. Also, life as a public company will involve new challenges that an experienced legal team can help you prepare for and navigate.
This list is just the tip of the iceberg. For an inside look at the entire IPO process, download a copy of The Latham US IPO Guide. The 2020 edition of the US IPO Guide reflects the accumulated wisdom of the world’s leading IPO law firm, explained in a lively, plain-English style, free of jargon and gobbledygook. It has been updated for the latest legal developments.