Success entrepreneur Jason Wood is going to provide sage insights into IPOs
LARGO, FL / ACCESSWIRE / March 15, 2021 / Taking a company public offers one way that businesses can raise funds for operations. An Initial Public Offering (IPO) also allows founders and others to cash in on their stocks to make money. That said, IPOs are complicated. That's why Jason Wood is going to offer some vital insights into taking a company public.
"Taking a company public is often a wise choice," Jason Wood says. "That said, before deciding to do so, you should sit down with your team and advisers to decide if an IPO is a right move right now."
An IPO and your company's valuation can be impacted by a huge range of factors. General market downturns and recessions could depress stock and IPO values even if your company itself has put in strong performances in the past. Likewise, if stock markets are at historical highs and investors are struggling to find places to park their money, your IPO may enjoy strong market momentum.
Still, individual factors are important. If you want to take your company public, you need to make it IPO-ready. Among other things, this means getting your financials in order, securing strong and consistent growth, and mapping out a path to profitability. This will help you justify high valuations to investors.
"With IPOs, you need to have a clear ‘line of sight' to higher revenues, eventual profitability, and other achievements that mark success," Jason Wood says. "This means you should have a clear and achievable path to growing revenue at scale and producing a healthy profit margin."
Jason Wood Talks About Founders and IPOs
Achieving profitability and stable, consistent growth is much easier said than done. When it comes to companies, leadership is perhaps the most important single factor for predicting future success. Before going public, you'll want to make sure that you have a strong, smart, and capable leadership team in place.
Founders are often still on board when a company goes public. That said, it's important that leaders are selected for their capabilities rather than their seniority and the fact that they've been there since the beginning. While founders should be rewarded for their early commitment, ultimately talent, skill, and vision should determine who's in charge of what.
"Excellent founders often grow with the company. That said, a founder may possess the skills to lead a company or specific set of operations within a company during the founding phase, but not during the go-public phase," Jason Wood says. "Hiring a new chief technical officer to take over for the founding CTO may make sense, for example, if the founder is struggling to manage larger teams."
Jason Wood notes that ultimately by hiring the right leaders you can protect the value created by founders and their overall wealth and stock valuation. This is true even if the founder may have to take a reduced role.
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SOURCE: Jason Wood