In talking with folks who want to advise you about the going public process, it is key to determine the following: What costs should we expect to get public and then once we are public? Can you help us determine if we can afford to go and stay public? Too many companies go public without fully understanding the costs involved not only of going public, but continuing public status.
The cost of going public can vary dramatically depending on many factors: how you go public, what advisors are involved, if you are involved with a reverse merger what costs are involved in acquiring a shell, whether an SEC reviewed filing will be part of the process, whether audited financial statements are required and the like.
The first two questions I always ask of a company considering going public are: can you benefit from being public and can you bear the costs of doing so? The ongoing costs of being public also depend on choices you may make about whether the company will be SEC reporting, to what extent investor relations professionals will be involved, what type of law and accounting firms you wish to engage and the like. But once you make the determination you may be fully able to raise money or use cash flow to cover the costs, and enjoy the benefits, of a public trading stock.
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