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Discussion in 'Community' started by Macs R Us, Oct 6, 2004.
Just wondering what it takes for a compiny to go public, ie to have stock... Any ideas...
I think I would like to know this info too.
A lot of paperwork is required to issue stock for a company in the US or on a US market. Im not sure of all of the required steps to take, but if you check the Securities and Exchange Commission's (SEC's) website (http://www.sec.gov I am certain that they'd be able to give you some answers.
Best of luck.
There is a difference between going public and issuing stock. Any corporation can issue stock, but unless the stock is publicly traded, it is still a private company. In order to issue stock and have it traded on a public exchange, you have to go through alot of hoops with the SEC. One step that is crucial is a review of accounting records, but there are many more. Go to the SEC's site like jdechko said to find out exactly what is required.
I really didnt get a lot of time to put thought into my response, so here's some more information for you.
Vector is correct: there is a difference between simply issuing stock and going public. It all depends on what you want to do right now and what you plan on doing in the future, though. I still recommend that you check out the SECs website just so you know what you may (or may not) be getting into in the future.
Some things to know:
You will need some type of company summary to present to the SEC - this just tells them what your company does and what your plan is about raising capital
As vector said your accounting records will be scrutinized.
You will also need to keep track (in great depth) of your financial reports
A 10-K/10-Q (annual report/financial report) will most likely be necessary
An auditor will need to go over your books
They make you go through all the red tape to make sure that youre a legit business entity. Basically, they want to know that youre not running a scam. Also, to expand on Vector's comments, a privately held company is more likely to be people you know, so they can just come over and beat you down if you screw them over.
One last thing you might want to consider is picking up a financial accounting book. If youre a really small company and you keep your own books, or if you just want to have a clue about what your accountant is saying, this is a good idea and it will give you some of the metrics that youre going to need.