How Should A Company Go Public?
There are various modes to go public in the US. You can find three main grades of listing:
Here are the levels of stock listing.
OTC PINK SHEETS:
The oldest quotation service for over the counter stocks usually called "the pinks". There are technically no particulars needed for reports or audited financials on the pinks, but, the pinks have put into operation their own voluntary reporting system and implement it by publishing symbols to indicate the level of disclosure each firm is subscribing to. To publish voluntary details requires fees of roughly $5000 a year.
THE OTC BB: The OTC Bulletin Board is managed by the Financial Industry Regulatory Authority (FINRA) and expects that all companies whose equity is exchanged on the OTC Bulletin Board keep their current reporting status with the Securities and Exchange Commission (SEC), which needs current audited financial statements. There are no cost paid to FINRA for this quotation, but maintaining a public company current with its SEC reports can cost $25,000 - $50,000 per year.
EXCHANGES:
The OTC PINK SHEETS and the OTC Bulletin Board are convenient stock markets specifically for budding and new companies, but clients with flourishing businesses will prefer to be on one of the developed and higher equity markets - Nasdaq Small-Cap, Nasdaq NMS or NYSE. Each of these stock exchanges has its own qualifications that a company must meet to be listed on the exchange. Typically the types of qualification factors they look for include asset levels, number of investors, required Board level committees, incomes, and market capitalization. In addition all exchanges mandate the company to keep a current reporting status in the Securities and Exchange Commission (SEC). Listing on the equity markets usually involves charges in the range of hundreds of thousands of dollars.
For a US company a listing on the US stock markets strengthen points. For Example, a quotation is a means to:
1) Grow your company easier and make it more successful by increasing your ability to bring in "mergers", "acquisitions" as well as "strategic partners;
2) Expand your company faster and make it more powerful by improving its ability to compete for large corporate contracts;
3) Strengthen your personal ROI as an owner by cutting down the amount of time it requires to make money on your investment, along with increasing the value of your company, as well as, converting the liquidity of your asset to a more liquid form than that of a private firm;
4)Raise money faster and cheaper by improving the "liquidity" factor for your shareholders
Now most of these suggestions are for organizations going public from scratch. For those of you wanting to invest in a shell corporation (public shell), to try mergers, then you might want to decide changing a quotation as stated above. For more information on this subject try googling phrases like "mergers companies" or "reverse mergers".
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