If you are a relatively new business, growth will understandably be your chief priority. But in uncertain economic times such as these, growth can be difficult to facilitate naturally. If your business is showing serious promise, though, there is one way your business could lock in rampant growth while growing visibility: going public.
What Does ‘Going Public’ Mean?
For the uninitiated, ‘going public’ is a specific process by which a business leader opens up their company to public investment. This is done through the issuing of ‘shares’ of the business to public tender, which can then be bought by individual investors.
Going public in the UK involves initiating something called an IPO, or Initial Public Offering. The IPO process sees a given business working with finance brokers to prepare the business for tendering shares on a stock market, whether the London Stock Exchange or an alternative market.
Adequate investor interest needs to be determined before an IPO can go to market successfully – but if your business were to successfully go public, it could be a major catalyst for financial growth. How exactly can going public help a business grows in its industry, though?
The strongest argument for initiating an IPO for your business relates to the generation of capital. In going public, your business is subject to valuation – which, in concert with the number of shares you wish to tender, decides the price of each individual shares. Investors buying these shares are, put simply, buying a miniscule portion of your business for the cost of the share. This is money your business then receives.
As such, an IPO can be a powerful way to generate a large amount of funding in a short period of time. Drumming a significant amount of both private and retail investor interest can help your generate more positive cash flow than any bank loan or angel investor could offer – enabling your business to make serious investments in expansion and longevity as a result.
A secondary benefit to going public with your business can be found in the additional attention your IPO will generate. A crucial part of the IPO process is onboarding potential investors at early stages. After this initial phase, the remaining shares allocated to market sale are made available publicly – at which point, your business may receive increased media coverage.
With your increased visibility, and with the shrewd investments you make using the capital generated through your IPO, your business will begin to see earnest and organic growth within its industry. As more and more investors come on board to back your work, your business will become more robust,
In turn, this increases your business’ overall worth and, in essence, makes money for you and your investors. This cycle of growth ensures continued interest in your business and brand, and a healthy relationship with those that help you fund your growth.