There are many keys to a successful IPO with a number of critical phases. Before starting the whole process it is advisable to get a better understanding of the required changes to the business processes, demands on resources, time, marketing and capital structure involved before you go ahead by performing an IPO readiness scan.
An IPO presents challenges of varying degrees of difficulty and may include the
- preparing a robust and credible business plan;
- improving standards of corporate governance;
- preparing a financial track record;
- coordinating various legal, financial advisors and investment bankers;
- performing a transition from local accounting principles to International Financial Reporting Standards (IFRS) or US generally accepted accounting principles (US GAAP);
- preparing and verifying the prospectus;
- agreeing on an appropriate capital structure;
- preparing for a due diligence;
- marketing road shows to institutions.
Apart from changing market conditions, which are outside a company’s control,
most delays in IPO processes can be eliminated or reduced with proper planning,
disciplined allocation of resources, coordination and execution.
An important decision to make is where to list the shares. Although with current technologies the world may be your market, every stock exchange will have different advantages and disadvantages for different companies. Consider factors such as:
- regulations of the various stock exchanges and local regulators;
- political climate;
- public awareness of the company in one area;
- planning as well as admission requirements;
- liquidity and trading volumes;
A common and advantageous structure could be the establishment of a Dutch N.V. holding company with a listing of the N.V. shares elsewhere in Europe or the USA.