Many viable and profitable businesses somehow after a year or two or even years of trading got into financial difficulties. Cash is the only name to sustain a business operation. Without cash, business expansion is impossible. Insolvency arises, and eventually, the business may be forced to close.
Options are available for capital for business or project financing such as:
- Go public and IPO
- Venture Capital
- Crowd Funding
- Bank Borrowings
Why Public Company?
- It is a vehicle for raising capital
- Public Trust
What is an IPO?
IPO means Initial Public Offering. It is the initial public offering of the Issuer’s securities to the public to raise capital for the business or proposed project. The company or the Issuer (a term used in the capital market for the company that issues securities to the public to raise capital) must first become an approved public company, filed a Prospectus with a securities and exchange commission and sought approval for the IPO.
What are the Advantages of a Public Offering for raising capital?
- No pledging of tangible assets or personal assets for raising capital
- No repayment of the capital raised. It is not a loan
- No interest payment. It is not a loan.
- No limitation or restriction to the number of times for raising capital
- Transparency, creditability, trust and shareholders’ support assured
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Categories: Public Company, IPO and OTC Markets