IPO Loses Its Luster For Some These Days
from the high-class-problem-to-have dept
Are IPOs becoming less attractive? In the post-bubble economy with higher costs, more government scrutiny and all the work that goes into an IPO, some are questioning if the IPO still should be the liquidity event of choice for entrepreneurs. The story uses the example of one dot com CEO realizing the process was too stressful and distracting from the work at hand, and decided to sell out instead. The story contains a litany of experts who attest to the fact that it is growing more expensive and more challenging to run a public company, but struggles to find more solid examples of companies that could have done an IPO but opted for a sale instead. The perception is still that the IPO is the way to go. In part, this is because VCs, the press, and plenty of others still seem to promote the IPO as the only viable “exit strategy” (not necessarily ever asking why an “exit strategy” is needed), and partly because, indeed, you are much more likely to make gobs and gobs of money that way. So, it’s going to have to get a lot more expensive and troublesome to become and run a public company for them to sell out when they can IPO instead.