3c hapter - Index of

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C H A P T E R
The Do- It- Yourself
Public Offering
The Allure of Public Venture Capital
So far, we have explored various ways that entrepreneurs can
connect with investors. These models hold great promise, but
each has its limitations. Sometimes the most effective method of
raising capital is to take the leap and go public. Indeed, the initial
public offering, or IPO, is the magical moment that many entrepreneurs
and their early stage investors dream of, when they can
reap the rewards of their risk taking. Nothing says you’ve arrived
like an IPO.
Generations of ambitious companies have chosen this route.
Public stock offerings are often the best solution for companies that
need a signifi cant capital infusion. Selling shares to the public opens
up a huge new pool of growth capital with none of the constraints of
private investments. This is long- term capital: no loan to pay back,
no interest payments to be made, no pressure to sell the company.
And millions of ordinary investors get their fi rst shot at owning
shares of an admired company with strong growth prospects.
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