The term “public listing” is synonymous with “Initial Public Offering” or IPO. A private company seeking growth and expansion may participate in a public listing to raise capital. By the time the company’s chief executive officer has formally signed off on the stock exchange on the day of the initial public offering, the company is considered a public entity and therefore a “publicly traded” company in the Stock market.

Purpose of the public list

Prior to the initial public offering, there must be an agreement between the founders of the private company on the amount of capital to be raised and the plan for spending that capital. It’s that during the planning stage, one or two of these IPO goals would be voiced by someone on the management team.

Buy new equipment, software or build infrastructure.

· Diversify products or services through research and development.

Expand the operation to new regions.

Pay old or existing debts of the company.

Get more money from the original investments.

Public Listing Process

While the IPO has become popular jargon in business and economics for decades, it is actually a complex and painstaking financial process that requires time and money to execute. It starts with a private company hiring an underwriting firm or investment banker to help them through the entire initial public offering process. It goes without saying that for a company to become a publicly traded one, it must also invest in people, time, and money.

By going public, a company is supposed to be co-owned by a new group of investors. They are the same investors who before the IPO, or during the “road show”, showed interest in becoming co-owners of that particular company. Based on the public listing rules, a company that intends to sell its capital in the form of shares can choose the exchange on which it wants its shares to be traded electronically. It may be listed on NASDAQ, NYSE, or any stock exchange in a certain country subject to its existing trading rules and trading policies.

Functions of the insurance company and the issuing company

It is the underwriting firm that assists the company issuing the IPO in compliance with the public listing rules established by the Securities and Exchange Commission (SEC). The SEC is an organization that reads, interprets, and approves a prospectus based on public listing regulations, legal issues, and financial policies. Throughout the course of public listing, the underwriter performs the following main duties and responsibilities.

Set the target or initial offer price for the stock.

Help the company create the prospectus (a formal legal document filed with the SEC)

Help the company balance the supply of shares with the demand from investors

Distribute shares to the right investors through known distribution channels and contacts

The success of a publicly traded company largely depends on the collaboration between the issuing company and the insurance company. Their goal is to make the IPO happen on time, on target, and in accordance with SEC rules. For one thing, company executives need to make sure they have a well-written business plan ready to present to potential investors before the IPO. On the other hand, underwriters must dedicate their expertise in creating the prospectus that will be approved by the SEC.

Succeed with the initial public offering

The price per share is what will determine the fate of a company in the hands of the investing public from the day of the IPO to about a month of trading in shares. The target price could go up or down depending on supply and demand for the shares. A company is said to be successful in going public if it was able to exceed its target capital due to appreciation in the value of its shares (which is often the case).

Once a company goes public, its executives, employees, and stakeholders must work together to ensure the satisfaction of its shareholders.