Question: Amina has a big decision to make. Should she: Continue on as she is running a sustainable business? Go for Malika's offer of investment and
Amina has a big decision to make. Should she:
Continue on as she is running a sustainable business?
Go for Malika's offer of investment and commit to taking her company public?
Sort Amina's list of IPO considerations into pros and cons.
Pros
Enormous opportunities to grow the business by raising a lot of money quickly.
Less debt and more money for things like advertising, new products and benefits for staff.
Generates publicity and media coverage IPOs are big news!
Access to professional venture capital investors who have direct experience in Amina's sector.
More likely to atfract talented staff and senior managers.
Once public, all company dealings and data are under scrutiny. Board members and senior management are held to high standards and subject to financial investigations in the form of audits.
Because the IPO process is so intensive, the energy needed for going public can take away from efforts elsewhere in the company, leaving it open to competitors or mismanagement.
There might not be enough interest from investors to make it worth while.
They are expensive a big team of Lawyers, Investment Bankers, and Accountants are needed to navigate the longwinded process for about a year.
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