Bitcoin and your IPO
Ready to go public with your IPO?
If you’re thinking of raising funds for your company public, researching your prospects for potential listings and investors will be your utmost priority. While it is true that the traditional way of raising money for new companies has morphed from an IPO to an ICO (initial coin offering), knowing how to navigate the IPO process can ease the listing process.
Capital markets on Wall Street have been the typical choice of most potential issuers in the U.S., but a greater number of corporations have been considering Canadian markets. The TSX and the TSX Venture Exchange have been some of the markets of choice. If you’re a foreign issuer (a company based in the U.S. wanting to list on a Canadian market), there a number of factors to consider.
You should consider:
- Whether you are financially ready to go public. Canadian markets generally require a business and financing plan for the next 12-24 months of your operation, and some markets require a certain amount of capital, depending on what industry you are offering securities
- Whether your Board of Directors have the relevant experience in Canadian markets to steer the listing process
- Whether you have the necessary financial, legal, and administrative team in place to assist with your listing
- Whether your company can weather the storm in the event of potential obstacles of listing
If you’re offering securities and the industry your company operates in involves blockchain technology or cryptocurrency such as bitcoin, there are additional concerns you must address.
As cryptocurrency can represent a volatile market, getting potential investors to invest in your company or stock may prove difficult.
If your company is a newly established company with little capital, you will need to consider engaging in Angel and Accredited Investors or Sponsors. As angel investors understand that initial and early investments (particularly ones involved in cryptocurrency) typically lose money and never make it to an IPO, angel investors usually invest money with the understanding that significant risk is involved. Accordingly, obtaining investors will take substantial planning and creativity.
Whether you’re a company thinking of going public, it is imperative to determine whether you are prepared to do so. Understanding the risks and initial start-up costs that come with the initial listing process will hold your company in good stead for getting listed with a better foundation for success. If you’re thinking of going public, get in touch with one of our representatives today.