Going Public without a Reverse Merger or an IPO
There are several advantages of traditional IPO’s over reverse mergers for large companies. Reverse Mergers have fallen out of favor and for companies interested in going public, there is good reason to avoid a reverse merger or a public shell.
IPO’s of a significant size are known to attract big name underwriters that are able to raise millions to billions of dollars through their clientele. Very few companies qualify for these underwriters.
Larger companies qualify for listing on a stock exchange, such as AMEX or the NYSE. Underwriters will typically market these companies well and create a huge demand for the stock. This creates a situation where the demand for shares is more than the shares available.
Many companies chose to go public through a reverse merger, but there are better options for them. Companies may choose this because their earnings or assets do not meet the requirements to be listed on a large stock exchange such as NASDAQ. This type of company would trade on the OTCBB, and potentially make its way up to a larger stock exchange such as AMEX and get listed. If you are not doing $60 million in revenues, you will not be able to attract an underwriter to do an IPO for you. You also want to stay away from doing a public shell reverse merger. Through our process, we can take your company public without an underwriter.
For more information on reverse merger or shell corporation definitions, disadvantages, public shells, and more please contact us.