Benjamin Franklin is credited with the old adage “By not planning you’re setting yourself up to fail.” When private companies begin their IPO process, it’s a crucial moment that requires a meticulous and strategic preparation to ensure success.
Managing this complex and regulated process can be a challenge and time-consuming for any team. The IPO process involves multiple partners, including investment bankers, underwriters, and investors. It is critical to present a clear and well-articulated equity story that meets market expectations and provides potential investors with the chance to be a part of your company’s expansion plan.
One of the first steps in IPO preparation is to conduct an IPO readiness assessment. This considers https://designdataroom.com/what-you-need-to-know-about-ipo-process/ what a business needs to appear like once it is publicly listed. This will help teams discover any gaps that require attention before the IPO timeframe. For instance, many venture-backed companies do not have financial statements that meet the requirements for public company compliance. A IPO readiness test will reveal this issue, and assist the legal and finance teams rectify the situation well before the IPO process starts.
Once the initial preparation work has been completed, it’s time to prepare for the ongoing reporting requirements of regulatory reporting. This includes gaining access Securities and Exchange Commission (SEC) EDGAR system. It’s also crucial to establish an working group within your IPO team to work with your external law firm to draft EDGAR and iXBRL example documents. This will include a person who is responsible for uploading exhibits to the SEC and also coordinating with financial printer/SEC files.