IPO done; What Next?

Businesses look to financing in order to expand their footprints and touch greater heights. An Initial Public Offering (IPO) is an important step in this direction. The run-up to an IPO is fraught with apprehension and anticipation. The actual opening of the listing is nothing short of a celebration. But what does an IPO truly entail? Apart from the ‘We have arrived’ message that it conveys, an IPO tells much more.

“The good parts about being a public company are increased discipline, increased execution, and increased transparency to make sure that you are really building a company for a hundred years.”- Dan Rosensweig. These words encapsulate the very spirit of every company who has achieved this milestone. It is the stepping stone towards creating resilient, value-driven organisations.

The countdown is as good as any adrenaline-pumping adventure sport. The ringing of the bell marks a momentous milestone on a company’s journey. The mood is joyous as the air erupts with congratulations. Yes, an IPO is a big deal but embodies much more than mere scaling up and raising market capital. ?

IPO reiterates the way forward for a company and how seriously it pursues its growth map. Behind the celebratory mood, there are months of challenges, planning, and preparation. Now that the toasts are done, let the implications sink in.

IPO signifies marked change in management. Now, shares of existing shareholders can be traded in the bourses and command the public trading prices. Company ownership model converts from privately-owned as the business becomes a public entity. Investors enjoy greater liquidity by trading shares in public market in lieu of part-ownership. However, now management control and flexibility are reduced. The management is answerable to all shareholders.

IPO means greater exposure to public eye and keener scrutiny of operations. Public companies come under the purview of regulatory bodies. Though it’s business as usual, enterprises must implement change in business practices and ensure statutory compliances especially stricter norms for financial disclosures. To conclude, an IPO is many things, not necessarily what it is generally perceived as. It is a pitstop in the journey. Frederic Lardinois summed it up appropriately, “IPOs are the beginning, not the end.” ?An IPO is transitioning from one phase into another; the exit for early investors and the opening of the door for new.

To conclude, an IPO is many things, not necessarily what it is generally perceived as. It is a pitstop in the journey. Frederic Lardinois summed it up appropriately, “IPOs are the beginning, not the end.” ?An IPO is transitioning from one phase into another; the exit for early investors and the opening of the door for new.?