There are many obstacles to launching an IPO, and as the old adage goes, “by failing to prepare you are preparing to fail.” But with careful planning, strategic thinking, and meticulous attention to particulars, companies are able to successfully conduct an IPO.
The first step of the process is to conduct a thorough due diligence by your investment bank or law firm, as well as your accounting firm (auditor). This includes a thorough review of all financial and other documents including historical data forecasts, current projections, risk factors, as well as internal controls. This process should be conducted well in advance of the scheduled IPO date to allow companies to resolve any issues that might arise and potentially delay the IPO.
Once due diligence has been completed and due diligence has been completed, the next step will be to write the prospectus and registration statement. This involves a thorough study of the company’s history as well as its current performance, identification and assessing the potential financial risks, as well as drafting strategies to raise capital. Management should be involved with the creation of these documents since they are the best person to understand the company and ensure that the content aligns with their vision.
Once the documents are finalized and filed, they need to be filed with the SEC and then listed on an exchange. This usually requires the assistance of a printer for financials and SEC files who has extensive knowledge about underwriter style and SEC format requirements. This knowledge can reduce liabilities and risk of erroneous submissions. Carta’s private market liquidity solutions can delay the listing so that you can launch your business at the right time for your business.
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