{"id":2860,"date":"2020-03-23T17:55:57","date_gmt":"2020-03-23T17:55:57","guid":{"rendered":"http:\/\/localhost\/2020\/swoopMW20\/?post_type=knowledge-hub&p=2860"},"modified":"2023-11-30T13:07:51","modified_gmt":"2023-11-30T13:07:51","slug":"initial-public-offering-ipo","status":"publish","type":"knowledge-hub","link":"https:\/\/swoopfunding.com\/ca\/knowledge-hub\/initial-public-offering-ipo\/","title":{"rendered":"Initial public offering (IPO)"},"content":{"rendered":"\n
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\n \n What is an Initial public offering (IPO)? <\/a>\n <\/h5>\n <\/div>\n\n
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An initial public offering (IPO) marks the first time a company sells shares to the public. It\u2019s also known as \u2018listing\u2019 or \u2018floating\u2019 on the public markets.

If you\u2019re lucky enough to have a turnover of more than $5m (or you\u2019ve reached unicorn status!) you might entertain the idea of an initial public offering (IPO).<\/p>\n <\/div>\n <\/div>\n <\/div>\n

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\n \n Why choose an IPO? <\/a>\n <\/h5>\n <\/div>\n\n
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An IPO is the first time a business raises finance publicly (before an IPO, you can only raise funds privately). Going public allows you to raise large sums of money from new investors (e.g. for expansion) and gain a large number of new shareholders while retaining control of your company). Existing (private) equity investors might drive an IPO because they\u2019re looking to sell their stakes in your business.

An IPO is often called long-term, patient capital because once you have gone public; you can raise money time and time again, over years and even decades.

Public companies have to disclose financial information regularly. This means keeping shareholders and the market (including your competitors) updated with half-yearly and annual results.<\/p>\n <\/div>\n <\/div>\n <\/div>\n

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\n \n Why go public? <\/a>\n <\/h5>\n <\/div>\n\n
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Getting to an IPO stage is a milestone. Being a publicly traded company means your business has raised its profile to \u2018blue-chip\u2019 status.\u00a0

If you want to raise capital to fund further growth or finance existing debt, being listed on a stock exchange opens your business to vast number of potential investors with an unlimited number of financing options.

Also an IPO is an excellent way of monetizing assets.<\/p>\n <\/div>\n <\/div>\n <\/div>\n

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\n \n Have you also considered? <\/a>\n <\/h5>\n <\/div>\n\n
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Equity financing<\/a> –\u00a0refers to the capital an external investor injects into your business in return for a share of ownership (equity) and\/or some control of the business. Equity finance investors therefore have a claim on your future earnings but, in contrast to a loan, you don\u2019t pay any interest \u2013 nor do you have to repay capital. If you opt for equity financing, you\u2019ll sell a stake in your business in return for funds.\u00a0

Debt financing<\/a> – Debt financing is a broad term that covers any type of\u00a0loan<\/a>\u00a0that you pay back, with interest, over a set period of time. A loan can come either from a lender\u00a0\u2013\u00a0see\u00a0business loans<\/a>\u00a0\u2013\u00a0or from selling bonds to the public.
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Private equity<\/a>\u00a0– is a type of\u00a0equity financing<\/a>\u00a0suitable for established private businesses. Private Equity funds give your business money in return for a large or controlling share in your business.
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Venture capital<\/a>\u00a0– is financing given to startups\u00a0and early-stage businesses. Venture capital funds look to invest larger sums of money than\u00a0business angels<\/a>\u00a0\u2013 typically more than \u00a3250,000 \u2013 in return for an equity stake. Venture capital is most suited to high-growth businesses with long-term growth potential, i.e. those destined for sale or public listing (IPO).<\/p>\n <\/div>\n <\/div>\n <\/div>\n <\/div>\n \n