Pros Creates a market valuation for the business and enables the opportunity to raise capital for expansion, as well as the possibility of realising some of your investment. Provides access to an acquisition currency and transparency around the value of the business. Listed companies often use their shares, as opposed to cash, to make acquisitions.

This can be particularly useful when implementing a buy-and-build strategy when cash can be better utilised in other areas. Encourages employee commitment by rewarding them with something of clear value.

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On the other hand, employees of listed companies who are given shares or options can see exactly what they are worth. Creates a heightened public profile and improves the ability to attract high calibre board members.

To get people of that calibre into your business, being listed really helps, because they see the listed status providing a genuinely liquid incentive plan. Listed companies have to go through a rigorous due diligence process before they can join the AIM market. The checks and balances that are carried out can lead to increased confidence, resulting in better supplier credit terms, better relationships with customers and higher valuations from investors.

So because they knew that we had to govern ourselves in a transparent way it gave them the comfort that we run our company properly. Public companies are public property. As such they are expected to comply with the rules of the markets they populate.

Companies on AIM have to use the services of a nominated advisor known as a Nomad , a firm or company which has been approved by the London Stock Exchange, who effectively acts as the regulator of the business, managing its listing and ensuring its ongoing compliance. Issuing shares is not only dilutive but shares can also lack liquidity.

This can undermine fundraising and acquisition activity, because there is a lack of demand for the shares. In addition, a lack of demand normally translates into a low share price, so the use of shares as an acquisition currency may also lose its appeal. The amount of management time and the significant costs associated with a flotation and ongoing listing should never be underestimated.

What are the advantages and disadvantages of listing on the Nasdaq versus other stock exchanges? | Investopedia

From the process of flotation itself, which can take many months, to the time-consuming administration of regular and constant announcements interim and final financial results, director dealings in shares, trading updates etc.

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How a robust expenses policy can boost your business. October 28, Guy Rigby. The pros and cons of listing your business on the stock market. Thinking of listing on the stock market? Here's why you should. Here's why you shouldn't. Funding May 23, Hunter Ruthven. Funding February 9, Real Business. Ed Molyneux, CEO and co-founder at FreeAgent, shares his experience of listing on the London Stock Exchange and explains what not to forget.

There are several reasons companies go public. But given the uncertainty miring the corporate landscape, curiosity about recent IPOs got the better of us.

We asked bosses what made listing on AIM an attractive bet in Funding November 28, Hunter Ruthven. Funding November 24, Hunter Ruthven. This site uses cookies: