Going public in California does not mean unveiling your company for the very first time: It means offering your business to people to buy shares and invest. It’s a difficult, costly process with the goal of providing steady returns on investment once completed. The main purpose is to increase the business’s capital and expand operations.
What going public means
A public offering is the provision of a company’s securities to buyers and investors. These securities are listed for public trade on a stock exchange. As part of the offering, the company must publish the terms and conditions of the security. The types of regulations vary by jurisdiction.
The benefits of a public offering
For many entrepreneurs, going public is not a primary goal during the process of business formation and planning. This task often materializes later when the company wants to increase its capital and expand its services to a wider audience.
In addition, going public increases the company’s recognition and reputation in order to get a step ahead of competitors. Mainly, this offering is beneficial to businesses that want to expand their operations to local, national, or international markets. They may wish to open stores in additional locations or attract new customers globally. Increasing capital also helps a company to consider making a merger or acquisition.
Know your risks and options
Going public means reviewing and selecting from the different types of public offerings available to you. Providing securities seems simple and straightforward, but there are numerous risks involved, including the high cost, when opening your assets to the public. There are plenty of business resources you can consult to assist in the decision-making process.