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Every
publicly traded company needs some help to improve their shareholder
value. These tips are from those who have experience taking companies
public and providing all shareholders with an increase on their return!
Why Go Public?
by William Cate
Why Go Public?
By William Cate
Published September 1999
[http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website:
[http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
It costs money. It takes time. If you try to do an IPO, your odds of
completing it are about even. If you do the average IPO on the OTCBB, your
million dollar costs will exceed the money you can raise. If you go public
you have to battle market manipulations. You must avoid the Vulture
Capitalists that will destroy you. Public company survival risks can be
greater than for a private company. If your company is a stock scam, you
run the risk of facing criminal charges. The downside to being a public
company appears to argue against taking the public path.
There are three primary reasons that require you to take your
company public:
1. Without liquidity, investors won't risk their money on your company. If
they can't sell stock, they won't invest in your company. The ONLY way to
offer investors the ability to sell your stock is to take your company
public.
2. Stock is money. You can use your strong share price to acquire
cash-producing assets for your company. This means you can grow a hundred
million dollar company in less than five years rather than more than twenty
years.
3. When you sell, you'll get twenty times more money for your public company than you would for your private company. Public companies sell at Market Capitalization. This is share price times issued shares. Private companies sell for between 80% and 150% of their pretax profit. Crunch the numbers and you will ALWAYS get a bigger "Golden Parachute" owning a public company.
You can solve the serious problems created by taking the public company path.
1. You can cut your costs of going public by 75% to 90% by doing a spinoff,
rather than an IPO.
2. You can keep your stock away from the Depository Trust Company. Without "Street Stock," it's nearly impossible for anyone to manipulate your share price against the best interests of your shareholders. There are a score of
tactics that you can use to stop stock manipulation.
3. You can stop the Vulture Capitalists by requiring them to pay for the
stock they take. You should ensure that their payment is a multi-dollar
share price and never pennies. You can force them to sell their stock
outside the United States.
4. Your insiders can avoid being caught in a stock scam by not selling
their insider shares. You should Pool & Vault all the insider shares until
you can sell your company at Market Capitalization. Your insiders will get
the highest price for their stock. Your Investor Relations costs will be
lower during the public life of your company.
Are you serious about making your company a success? You must offer a
product or service to the World. You must build your assets over a hundred
million dollars. You must go public! You don't have a choice.
To contact the author: Visit the Beowulf Investments website: [http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website:
[http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
More tips for your
publicly traded company:
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