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How Effectively Run Your Business During The Lead Up To An IPO

Your company is well on the way to going public – congratulations! Launching an initial public offering (IPO) – especially with the help of a well-respected advisor that has a serious track record of bringing about successful public offerings –  will bring your firm some huge benefits.

How Effectively Run Your Business During The Lead Up To An IPO

These include:

Boosted access to capital

The lifeblood of any business, going public enhances your ability to tap in to (and raise) capital. This newfound money supply can be channelled into things such as an expansion of products, or forging ahead with a more specialized offering of services. In short, any time a company wants to really grow it will need a capital injection, and that’s something an IPO can bring you in spades.

Better bargaining position

Going public will also give your company a more favourable position in bargaining negotiations when it comes to dealing with outside parties or contractors. Being a publicly listed and traded firm adds a large amount of prestige to a company, making others more likely to do business with it (and boosting its brand).

Takeovers are more attainable

With the shares that a public listing gives you, it can be easier to amass leverage and use it to take over or merge with other firms. The shares are a form of equity, and in mergers or buyouts they prove to be a valuable tool to nail the deal.

Rewards for founders

The select few who founded a company, got it off the ground and on the path to success can be easily rewarded with shares after the firm goes public. This special payout to founders and early-starters is only possible with an IPO. What’s more, having shares on hand can be used as an inducement to lure in top talent, who look for more than just a simply wage from their employers.

Easy valuation

Going public also makes it easy to put a precise price on the worth of a company – something that is very difficult to do when it is private. Thanks to the magic of the market, the value of a company will be decided in seconds by those buying and selling its shares.

Okay, so those all sound pretty good. But remember, going public is a complex process that requires several steps that an experienced advisor can expertly guide you through.

However, it’s best to remember that this process can be distracting, taking a firm’s eyes off the ball. So don’t let your company get put off track in the run-up to a successful IPO by keeping in mind the following tips.

Stick to the plan

The business plan, that is. If your firm is becoming more and more aimless in the IPO lead-up, go back to your original strategic business plan. Read it over, and remind yourself of what the purpose and goal of the company is supposed to be. Over time, this mission statement can be eroded or forgotten as the venture becomes more and more complex, with new products and staff. Don’t let that happen, especially before an IPO.

Don’t let good teamwork go unnoticed

Reward employee teamwork. Never stop showing appreciate and giving special bonuses or gifts to the people who do the things a successful business needs – productive, on-time work. And make sure your staff have clear goals about what they’re supposed to accomplish, and give them guidance on how to get there. A dollar spent on employees will yield several more in productivity.

Keep short-term goals

Don’t get caught up in the big picture. Break a big job or goal down into smaller, short-term steps. This can make large responsibilities or projects run more smoothly with fewer disruptions.

Keep customers happy

But how do you know if you’re happy? Simple. Put yourself in their shoes and ask yourself what you want. Customers generally are looking for convenience, low prices, and quality products and services. Don’t forget that.

Oversight

Don’t be afraid to bring on outside oversight specialists to double-check that your company is running in line with all applicable laws and regulations. If there’s a problem, such as a lone wolf doing something wrong, outside experts can help quickly spot them and stop any problems before they balloon into crises. And these crises can include costly legal suits or government investigations that could scuttle or badly delay the IPO process.

Dora M. Martinez has been in the Business management industry for the past 5 years. She is presently working at a business consulting company in Toronto. She is interested  in cooking, photography, craft and painting. Follow her on  twitter @DoraMMartinez1.