Benefits

Your Benefits

When going public, a company has certain new obligations, but also enjoys a variety of benefits, such as:

Expanding access to capital

The number one reason for most companies to go public is the access to the most substantial source of corporate funding, the public market. An Initial Offering can immediately bring considerable proceedings to the company. Going Public generates additional capital for growth without the risks of debt or the restrictions that may be demanded by venture capitalists. Subsequently, the company can return to the market for additional capital.

Increasing Employee Commitment

A public company can institute a Stock Purchase Plan for employees. Such plans tend to elicit a stronger employee commitment to productivity and quality, since they link employees' financial future to the company's success. Similarly, stock-option bonus arrangements are attractive for company executives, linking their compensation to their own managerial performance. A public company can often attract and retain better employees.

Accessing the US Markets

A public company listed on the US Stock Markets grants key access to the powerful US Financial Markets. The Public Company will benefit from the growing economy as well as from business-supporting laws and regulations. The American Economy dominates the world. With somewhat more than four percent of the world's population, the United States produce over 30% of all goods and services. The US-Dollar is the leader in the financial markets. As said by the Stock Brokers in Frankfurt and London, "If Wall Streets coughs, the European Stock Exchanges gets pneumonia".

Expanding Marketing and business relationships

The range of publicity that a public company generates by meeting its disclosure obligations and by its Press Releases can be an effective reinforcement of the company's product-promotion and advertising initiatives. Furthermore, it can also bring it to the attention of prospective suppliers, distributors, customers or joint venture partners. Such relationships are strengthened by the added confidence knowing that the company has met stringed SEC reporting requirements and listing standards. The assurance that the company's financial condition is subject to continuing scrutiny by the market may even affect various business negotiations favorably. Image and visibility of a company is greatly increased when going public.

Facilitating Mergers & Acquisitions activity

A public company is better able to finance cash acquisitions because it has the option of raising capital through an offering. Alternatively, a public company can use its own stock and maintain its cash position. The valuation can be determined by the market, avoiding the complications of calculating the value of a private company.

Using low qualification rules and high liquidity

By going public on the NASDAQ Exchange, a company faces reasonable low qualification rules, making the first step to become a public company easier than anywhere else in the world. At the same time, NASDAQ offers the highest market liquidity of all stock markets worldwide.

Providing personal financial flexibility

Shares of a public company are much more liquid than those of a private enterprise. Moreover, the ability to time their conversion to cash, while observing insider selling restrictions and market trends, is greatly increased. The profits of the sale of stock can even be tax-free, subject to applicable laws.

Reducing bank influence

A public company may want to use raised funds to reduce or eliminate the liabilities at financial institutions and draw back influence of banks on business decisions.

New Obligations