Reading: Why Go Public?

An IPO can offer many great advantages for the issuing firm, its managers, and the investing public. These benefits can significantly increase the value of the firm and reduce its risk. Very generally speaking, the benefits of going (and being) public are threefold:

• Direct value creation from the decision to go public
• Better financing terms of publicly traded companies
• Operational gains and better governance

In what follows, we discuss these key benefits of going public.