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Posts Tagged ‘how to take your company public’

Take Your Company Public: Here Is The Process

December 12th, 2013 Comments off

Becoming a publicly traded company is an exciting and rewarding experience. The following sets forth the method, steps, fees and estimated timetable to go public on the OTC Bulletin Board (OTCBB) ‘from scratch’, or through a self-filing and discusses the 1934 Exchange Act responsibilities after a company’s registration statement has gone effective (after the company has become publicly traded):

Prior to filing the registration statement, a company that wishes to go public must first obtain an audit of the Company’s financial statements for the past two fiscal years. For most companies, the financial audit can be completed in about a month and costs typically range between $5,000 and $25,000, depending on the complexity of the company financials.

A public company will also need shareholders. To that end, if additional shareholders are needed, the company going public will need to complete a self-underwritten Regulation D, Rule 506 offering in which the company sells shares of its stock to investors for real consideration. This is not a difficult task, so long as you have a properly prepared private placement memorandum (PPM) and you follow the relatively simple rules of Rule 506. The price per share and number of shares offered can be determined by the Company, but most registered broker-dealers that will eventually submit a Form 211 for an OTC Bulletin Board quotation prefer to have a minimum of 400,000 shares distributed among the investors.

In addition to the minimum number of shareholders requirement, a company must have free-trading shares, called the ‘float’, in order to go public. Upon completion of the private offering and the financial audit for the prior two fiscal years, an S-1 Registration Statement must be filed with the Securities and Exchange Commission (“SEC”) to register the shares sold in the private placement, thus creating the free trading shares. The completion of the S-1 process with the SEC will make the Company a 1934 Exchange Act reporting company, which is required in order to obtain a quotation on the OTC Bulletin Board. The SEC will review the S-1 and provide comments within 30 days from the filing date. Comments from the SEC typically relate to the terms of the offering, the Company’s business and its financial statements. It usually takes between 2 to 3 months for the SEC to approve a registration statement on Form S-1 and for the S-1 to become effective. However, the actual amount of time will depend on the level of review and number of comments given by the SEC and the corresponding response time by the Company in filing its amendments.

Shortly after filing the S-1 registration statement with the SEC, a market maker must be ‘engaged’ to file a Form 211 application with FINRA for the purposes of obtaining a quotation of its common shares on the OTC Bulletin Board. It is important to note that market makers cannot receive compensation for making a market in a stock, thus typically you must have connections to accomplish this. The timetable for approval of the Form 211 process is approximately 3 weeks to 5 weeks. However, the Form 211 will not be approved until the S-1 is approved by the SEC since the approval of the S-1 provides the “free trading” shares necessary to obtain the OTC Bulletin Board quotation.

The completion of the entire process to become a public company typically takes approximately 3 to 4 months from completion of the private offering and financial audit, however, the actual time could vary based on the factors discussed herein. If done right, with planning, hard work, the proper foresight, and a good firm guiding you through the process, going public is a truly exciting and rewarding experience.

Take Your Company Public, call Princeton Corporate Solutions at 267-233-0183Take Your Company Public the easy way!

Real Estate Investors: Take Your Company Public, Over The Counter Bulletin Board

July 1st, 2013 Comments off

For real estate investors, there are two things that are always in short supply regardless of the ups and downs in the economy: capital and quality inventory. Most investors that I have worked with not only need capital but strategies to go after capital that is not issued based solely on a credit score. Even if a real estate investor has good credit they still have the obstacle of too many inquires and too many open loans on their credit report and funding sources are spooked by these distractions and turn the applicant down even though all of their loans are current and they have a solid FICO.

If the above describes you or if you have limited or poor credit and you’re a serious real estate investor, here is how to get all the capital you’ll ever need. First put a solid strategy together. Start with your company infrastructure. Organize your company with a CEO, CFO, Board of Directors etc. After you’ve done this you want to set up your inter-industry strategic alliances which should be composed of other investors, bird dogs, electricians, roofers, general contractors etc. You want each of these alliances to have a purpose. They should be a portal for industry niche knowledge and consultation and also referral hubs. Let each of your alliances know exactly what type of investments you’re looking for and as they are sending you referrals, reciprocate by issuing them work in whatever specialty they are in.

Next you want to have a solid business plan written for your company (don’t write this yourself, have a professional do it for you) that spells out the intricacies of your company, your alliances, your accomplishments and goals. Paint a picture of success and strength.

Next you need a mechanism for accepting investment capital so you’ll need a Private Placement Memorandum. This document package gives a technical breakdown of your investment opportunity and spells out the risks and advantages in detail to keep you from getting sued by investors down the road. This memorandum takes advantage of SEC Regulation D Rule Exemptions 504, 505 or 506. A PPM is the minimum requirement dictated by the SEC for accepting capital from accredited and non accredited investment sources. Real investors will demand an PPM anyway so it’s good to have it done beforehand.

Now that your company is properly structured, you have a solid board of directors and alliances; your business plan is well written and to the point, you have a solid outlet for accepting capital from investors, you are now ready for capital. Your best bet is to go back to the company who wrote your business plan and private placement memorandum and use their ‘investor finder’ service. Legitimate corporate consultants who write technical documents will also stand behind their work by assisting their clients in finding investors. One solid strategy for getting access to capital quickly and easily is to have your Investor Finder forward go through their database and email individual and institutional funding sources.

When you are contacted by these investment sources, give them the option to invest in your company using the PPM (which will give you a fund in which you will be able to rehab real estate, buy at auctions etc). You will also want to give them the option of investing in a ‘per deal’ scenario. Allow them the option to also (or only) invest in particular transactions with you so when you get a deal, with a solid investor finder service, you’ll eventually have 100+ solid investors to go to for quick capital on particular transactions that go above what your PPM fund can handle.

There you have it, a strategy that works 100% of the time for real estate investors globally. Your best bet, to make sure that you do this properly, is to hire a consultant that can set up this process for you. Cheers to your success!

Need Real Estate Partners and Funding?Need A Corporate Consultant?, call Princeton Corporate Solutions at 267-233-0183We Can Transform Your Business

How To Build Strong Strategic Business Partnerships and Alliances Fast and Easy!

May 27th, 2013 Comments off

Do You Need Capital For Your Company? Build Strong Strategic Partnerships! In this economy, companies who survive have more than just a strong business model; they have aligned themselves with strategic partners in a joint effort to create a win/win relationship where each contributes to a pool of contacts, promotional initiatives and industrial knowledge.

Strategic alliances are the number one way to strengthen your company if you are trying to raise capital from venture capital firms, angel investors, hedge fund lenders, angel investors or if you are trying to take your company public. Empirical evidence companies who demonstrate a track record of unified success strengthens the package and puts you on the radar as an invest-able entity and you’ll start to get attention from the big players as you watch the value of your company soar.

The big question is, “Where do you find these partners and who can help you speed up the search?” You should start by having an executive meeting and put all your industry contacts together and invite these contacts to a networking ‘meet and greet’. Make it nice. Have a caterer, have giveaways etc. After you’ve done this the next step is to talk to your accountant, attorney, members of professional organizations in which you are a member, your banker, your billing service (if you outsource your invoicing), your financial adviser and/or consultant and any other professional that you’ve used in the past who has access to corporations in your industry or in a complimenting industry and can introduce you to new partners. This is exactly how ‘in demand’ executives and powerful CEO’s, CFO’s and consultants do it.

I have personally built a database of 10,000’s of contacts from using these methods, in fact I’ve never gone into a consulting situation where I couldn’t introduce my client to 1,000+ new strategic partners and I just cherry pick to find the best partners for my client. Your contact portfolio is the most powerful thing you’ll have in business. Contacts are your bartering chip when you’re in a crunch or when your board of directors is all looking at you waiting for a miracle. I have made it a point to create contacts in every industry no matter how polar opposite the industries may seem because it has allowed me to step into any situation with companies of any size and immediately start putting the pieces together and building an infrastructure based off of the powerful knowledge of dozens of industry experts.

Take the initiative and find a consultant who can help you launch your company into a whole new realm with the power and knowledge and expertise of a contact base built to induce growth and stability.

For Strategic Alliances and Partnership Services or Investor Finder Services, call Princeton Corporate Solutions at 267-233-0183Take Your Company Public the easy way!

Private Placement Memorandum: How to Get the Investors You Want, Easily!

May 25th, 2013 Comments off

Entrepreneurs are being turned onto Regulation D in droves. Regulation D Rule 504, 505 and 506 allow companies a more lenient fund raising process than those who choose to go public by other means. In the past year I’ve seen more PPM consultants pop up on the internet than ever before and I have to admit I’m concerned. As a veteran in this field I’ve seen it all, now we have a legion of self proclaimed Reg. D gurus who buy templates, add some text and tell their clients that they are delivering a customized offering memorandum; here’s where things go bad and a difficult situation gets even worse. You have this worthless document, now what?

You need to gain the confidence and capital of accredited investors without soliciting as dictated in Regulation D Rule 502c. Now you have a worthless document that you can’t solicit investment capital for (which your guru consultant never told you but took your cash anyway) so how are you suppose to raise funds for your company? First, you’ll find that you’ll eventually need to make your way to an actual PPM author, not a broker so that you can get a PPM that protects you from lawsuits and gives the investor a real breakdown of the upside and downside of your business.

Next you’ll need to find a “Investor Finder”, yes this is an actual term for an individual or corporate entity that is completely submerged in the accredited investor realm and is able to match your opportunity with friends that he/she has in their database of real, accredited investors. This is the second half of the PPM equation.

Don’t kid yourself and don’t allow yourself to be lied to; you’re going to need a seasoned professional to help introduce you to investors that have the capital to help you get to where you need to be. Friends, family and employees will commit to investing in your company until your PPM is completed and it’s time to make good on their commitment; all of a sudden little Johnny needs braces and Sally is in the hospital with pneumonia, this happens all the time. Now what? With a real Private Placement Memorandum and a solid Investor Finder you’re problems are basically over. Investigate where the author and I.F. stand in the Internet public domain and after you find a company that meets your needs, get moving and start raising capital.

The internet tells all when it comes to reputations, you’ll be able to tell the difference between a seasoned veteran and a startup consultant after on Google Search and a phone call. A PPM can make raising capital quick and easy if you have the right firm in your corner.

Private Placement Memorandum, call Princeton Corporate Solutions at 267-233-0183Take Your Company Public the easy way!

Take Your Business Public Successfully: The Spoke Wheel Approach

April 20th, 2013 Comments off

The ‘Spoke Wheel’ Approach To Taking Your Company Public.

A public corporation, just as a private company is composed of several contributing factors that dictate the outcome of its success. If you visualize your corporate entity as the ‘hub’ of the wheel and each spoke as a ‘contributing asset’ to the company you’ll find that the more spokes in the wheel, the more weight the wheel can carry as its strength rests on scores of unified connections working together, each with one simultaneous point of interest, the hub.

These hub connections can be anything that contributes to the overall success and perpetual, yet controlled, growth strategy of the company such as: a dozen strategic partnerships that act as growing distribution channels for your product or service, finance alliances that take care of your growth capital needs, multiple legal professionals that you can tap into for advise and corporate strategies, dozens of companies within your industry that focus on a different element of the industry but cooperate as a referral source for new business and on and on.

Your goal, in creating a solid, strategically aligned pre public and post public corporation is to keep building spokes and bringing on partners and executives that can instantly contribute to adding more strategic alliances and growth enhancers to your ever evolving and emerging corporate wheel.

If you are a public company, partnerships that you should have heavily represented in your model should be securities attorneys, market makers and broker dealers, several publicists with different areas of media focus, viral publicists, investor relations facilitators and service providers etc. Don’t forget the political contacts and padding contacts. By ‘padding’ I mean contacts that may serve no active role other than having some big names affiliated with your company that can gain attention within and outside your specific industry genre.

Go Public With Your Company, call Princeton Corporate Solutions at 267-233-0183Take Your Company Public the easy way!