https://designdataroom.com/what-you-need-to-know-about-ipo-process/
Many private companies are considering an initial public offering (IPO) as a viable option for boosting their business. But this process is complex and carries significant risk and requires careful planning and strategic thinking to ensure long-term success.
The first step to prepare for an IPO is to create and present your equity narrative which explains to investors your strategy for value creation and sets apart your business from other companies. This is essential for establishing an attractive valuation and attracting the interest of investment bankers, analysts and underwriters.
Next, you need to assess your leadership team and management. An IPO is a risky business therefore you need to be sure your management team is able to handle it. An IPO, for example, can have additional tax implications and financial reporting requirements that could require the addition of a finance or tax expert to your executive team. It is also necessary to decide if you want to have dual class stock, which grants founders and other executives distinct voting rights.
A strong track record of financial control and accountability is vital for an IPO. This means having a clearly defined SOX program, which should be in place and updated before the IPO. It is also important to examine your current system of records. This includes minutes, capitalizations files material agreements, historic option grants. This is essential for meeting SEC requirements and bank underwriters. It is important to determine whether your company has «material weaknesses» so that you can make them better before launching the company.