Comment by jrochkind1
10 hours ago
Can you connect the dots for me, why would reduced reporting requirements allow more startups to go public earlier?
10 hours ago
Can you connect the dots for me, why would reduced reporting requirements allow more startups to go public earlier?
Some people argue that the requirements placed on public companies (like mandatory quarterly reporting) add operational overhead that might cause a company to postpone an IPO until they're larger or more established.
In practice, companies like Stripe, OpenAI, etc have stayed private because they've been able to access the cash they need at valuations they're happy with and because no one wants to open their books unless they have to. They aren't staying private because being a public company is hard.
Combining this with a SPAC a startup would be able to have a six month runway as a public company before having to disclose finances. I imagine that would be attractive to some firms.
Weird, why wouldnt this fantastic startup want to report on their performance in a standardized and accountable manner for six months after collecting public money to pay out insiders and “sponsors”?
Surely they wouldnt mind bragging about their fantastic GAAP P&L in their filing docs. Maybe its the pesky quiet period theyre trying to avoid, so they can be even more transparent about finances and equity holders.